This is interesting because it seems like the DOJ's definition of monopoly is changing, which I think is a good thing. Since the late 80s (roughly), antitrust litigation has only been brought on the basis of a monopoly's negative impact on consumer prices (i.e. does the existence of a monopoly cause the consumer to have to pay higher prices?). That ignores monopolies that impair the ability of smaller companies to enter markets (which is one of the issues raised with respect to some of the current internet giants). Prior to the 1980s, this latter kind of monopoly would have been subject to scrutiny and possibly litigation by the DOJ, but since then it has been ignored.
This has been a major gap between the American understanding of monopoly protection and the European one.
In the European space, protection of smaller business' ability to compete is factored in. But the US space, in general, has not cared if smaller businesses can compete and tends to take a laissez-faire attitude towards business-on-business market pressures. It's the effect of the market on consumers that's paramount.
To be honest, I'm not sold on the European-style philosophy. Guilds traditionally empowered tradespeople, but they also had a reputation for holding back innovation and punishing new ideas that didn't fit the existing paradigms. Amazon, for example, has made book-buying so cheap nationally that individual bookstores have trouble competing. Amazon's other failings aside (which should be addressed by sweeping employee / labor protections, not by breaking up Amazon): should Grandma's books be more expensive in general so the local bookstore owner gets to enjoy the lifestyle of self-business-ownership to which he is accustom? Why / why not?
No, no, no. Amazon disrupted the grip that publishing houses had on publishing, they have democratized writing. Publishers and bookstores had restricted markets that were dictated by a few big publishing houses. Amazon disrupted that, which has lead to far more books being written. Books that have been self-published. How on earth is that considered a failing?
Bookstores are no longer viable, because Amazon has obviated the need for a brick and mortars store, and it passes the benefit on to both consumer and author alike, in reduced prices and thus increased sales.
Since Amazon is not in the authorship business itself, since it gets an equal profit on all books, its book business is a lovely example of markets working to further society.
Amazon's problem is in the use of data metrics on its giant store to create products that compete with its partners. The Amazon Essentials line is anticompetitive IMO, because as the operator of such a large platform, Amazon has a responsibility to the US economy.
> Amazon's problem is in the use of data metrics on its giant store to create products that compete with its partners. The Amazon Essentials line is anticompetitive IMO, because as the operator of such a large platform, Amazon has a responsibility to the US economy.
Curious on your thoughts about Kroger/Great Value/Archer Farms (Target) brand items? At least Amazon marks them clearly as house-brand, Archer Farms is practically camouflaged at Target among the brand names, and it's placed pretty prominently too.
Personally I think it's hard to draw a distinction between the two cases - either they're both fine or they're both not. My line would be closer to: if Amazon noticed a certain thing was selling really well, created their own version of that thing, and then de-listed the original thing from their store, that seems like the point at which it becomes anti-competitive to me.
Store brands are an age-old practice so it's interesting to revisit them in the context of mega-corps like Amazon. Although WalMart+Great Value is probably a similar scale.
> and then de-listed the original thing from their store
While they don't delist items, their algo favors products they sell directly to the extent that Amazon will get the buy box over a third party seller even when that seller is reputable and cheaper. Add that the 3rd party seller has to pay a sales fee to Amazon, often making it impossible to compete with them without approaching zero margin.
It's not delisting but it's the next best thing. If Amazon starts selling something you sell, your sales are gone, you were just free market research for them.
>While they don't delist items, their algo favors products they sell......
Which is still the same in the Target example where their own brand product get much favourable placement. This practice has been going on for so long possibly before all of us on HN were born.
I would argue its not similar at all. Finding those reputable sellers can be more difficult whereas this would be similar to the same target item showing up four or six different times on the shelf intermixed and tagged multiple times. No?
Not really, Visual Merchandising and placement is a field on its own. Target knew precisely where to put items if they dont want that brand to do any sales, to the point where it could be 30% to 40% drop even from a Reputable brand and sellers, and 70%+ from lesser known brands, effectively killing it.
It is a tactic often used in dispute, that is why Brands needs to work on Branding to combat this stronghold from Distribution. And one reason why small brands likes the Internet so much rather than working with conventional distribution channel.
If you're selling to Target they can certainly hurt your sales with unfavorable placement, but the impact isn't really comparable to the buy box on Amazon, the overwhelming majority of sales are buy box clicks.
A direct comparison would be target putting your product behind their product on the shelf where the shopper can't see it without digging for it.
All they are doing is learning what is worth white-labeling. They still need to manufacture a product that is equal to or better than what it is competing with. The overwhelming majority of these products are absolutely generic things for which there are already many alternatives and Amazon is adding one more.
So, I though Amazon mostly got to where they are by exploiting the poorly-designed concept of sales tax by selling things across state lines, knowing full well that no one cruelly pays "use tax", and so was able to sell things much cheaper than brick and mortar stores; and then when people tried to "fix" sales tax (still a broken concept) by charging Amazon in as many situations as they could, Amazon pushed back hard until they could see the two major brick and mortar book companies failing, and then said they would comply but only if they could have one more tax free year. Like, I certainly remember people I knew even say out loud they were buying books on Amazon due to the lack of sales tax, but it could be that they just didn't know that there was some other thing about "democratizing writing" that was causing their experience to be cheaper somehow.
I wonder if Amazon Essentials also plays into the quality problems that they have. I often buy Amazon Essentials because it's the easiest way to find a product that isn't a fly by night knock off.
You could have made the same argument about Standard Oil - until the competition were crushed and prices went up.
Which is why lower consumer prices aren't a valid defence against anti=trust. Nor is the argument that markets "naturally" lead to monopolies or (at best) oligopolies and cartels - even though empirically they do. So much so that setting out to create a monopoly is a bullet point on many unicorn-wannabe business plans.
The problem is abuse of power without oversight.
YouTube can screw over content creators with its insane system of copyright strikes. PayPal and Amazon can keep legitimately earned money on the pretext of non-existent ToC violations. Apple can decide to bar you from the App Store on a whim and clean-room your best green shoots ideas into its own products. Google can decide that you earned too much in ad revenue and shut you down just because it can.
People have lost businesses and livelihoods because of these practices. The monopoly position held by these companies makes them unassailable.
During standard oils run, the price of kerosene, dropped from 35 cents to 8 cents, and their percentage of the oil market actually decreased significantly long before it was broken up.
I read about that a while ago. This raised the question in the back of my mind: did the investors (Rockefeller) actually want Standard Oil to be broken up? As I understand it, it ended up being incredibly profitable for them.
> You could have made the same argument about Standard Oil - until the competition were crushed and prices went up.
Prices didn't go up until the government forced Standard Oil to break up. It had nothing to do with the competition being "crushed"; it had to do with the government taking the attitude you mention, that lower consumer prices didn't matter. Which seems daft since lower consumer prices mean consumers, i.e., the people, are better off.
The opposite of lower consumer prices not mattering, is lower consumer prices being the only thing that matters. It seems you are suggesting prices are the only thing. The key phrase here is “market power”, not just prices.
==since lower consumer prices mean consumers, i.e., the people, are better off.==
> It seems you are suggesting prices are the only thing.
No, but any supposed other benefits that outweigh prices getting higher are even harder to measure, so basing government intervention on them is even harder to justify.
> Over what time frame are they better off?
Um, whatever time frame the prices are lower?
> Are workers (also people) better off?
If they have to spend less on what they need, it would seem so.
“Things are hard to measure, so we should just focus on what’s easy, regardless of its actual effectiveness” doesn’t seem like a great compromise.
“Spend less on what they need” is same Walmart argument we’ve heard for decades. Meanwhile, the middle class shrinks and many of the things people need to improve their lives (shelter, healthcare, education) get more and more expensive and wages stagnate.
> Which seems daft since lower consumer prices mean consumers, i.e., the people, are better off.
I don't think that necessarily follows; price is big, but not everything. I don't care how cheap products are on Amazon, I still refuse to buy computer storage or anything that goes in the human body since they are either unwilling or unable to deal with counterfeiting problem.
> I don't care how cheap products are on Amazon, I still refuse to buy computer storage or anything that goes in the human body since they are either unwilling or unable to deal with counterfeiting problem.
Standard Oil didn't have a "counterfeiting problem", so I don't see how this is relevant to them. Or, for that matter, to any other large monopoly that has been broken up by antitrust action.
Also, you as a consumer might judge that, for example, you don't trust Amazon to deliver the product you want in a certain area, regardless of how low the price is. That's fine. But that in itself is no argument for breaking up Amazon in an antitrust action. It's just an argument for not trusting Amazon for certain types of products.
The issue is the consumer harm that comes from the combination of not trusting Amazon to deliver the qualities you care about for a certain class of product and there being no alternative suppliers because Amazon drove them out of business.
It seems like there aren’t any middle-quality products anymore: you can buy a cheap plastic item that never works quite right and will break next month, or you can buy a chrome-plated showpiece item that costs too much. Where’s the non-disposable, ugly, bulletproof utility version these days?
> It seems like there aren’t any middle-quality products anymore
I think there still are, but I agree it's very hard to find any on Amazon, at least in a lot of product categories. You have to spend time trawling actual brick and mortar stores.
YouTube can screw over content creators with its insane system of copyright strikes. PayPal and Amazon can keep legitimately earned money on the pretext of non-existent ToC violations. Apple can decide to bar you from the App Store on a whim and clean-room your best green shoots ideas into its own products. Google can decide that you earned too much in ad revenue and shut you down just because it can.
The problem is abuse of power without oversight
This is exactly how I feel about me dealing as a business with the big corps. But I did not actually had this experience myself. Reason is simple: I just do not engage. As a business I do not uses any cloudy stuff at all. Everything I do I host either myself or on rented servers that I could change on a moment's notice. No Youtube, no Apple app store, no hosting my software using Azure/Amazon/etc, no Github (I host my own), no Gmail etc.etc.
Is it? Or is that what good regulation is for? What if YouTube and their competitors all nerfed and deplatformed popular creators because of advertiser pressures? Isn’t this a better argument for regulation?
Remember that the reason that Bork defined antitrust the way he did was because there wasn’t a methodical definition of where it should be applied in the 60’s, and the govt was arbitrarily interventionist.
When it comes to books, Amazon didn't abuse their power. The big fights were because Amazon wanted to set their own prices in their own store, something that is pretty standard in most markets.
such a small trite comment can't really be taken by itself as a consideration of whether or not amazon has behaved in an anti-competitive manner. it's not appropriate to look at a part of amazon's portfolio in isolation; their dominance in one particular area is not particularly anti-competitive. amazon's book sales dominance, nor their dominance as an e-commerce platform, seem to be particularly egregious.
what's clear, however, is that they use their e-commerce position to also one-up competitors as a retailer. they have access to data about what's hot, what could benefit from a more economic option, etc. which they can use - perhaps anti-competitively (by e.g. intentionally selling at loss to defeat the new competitor).
additionally, their entire cloud computing arm affords them the opportunity to run other parts of their business at a massive loss, perhaps intentionally (again, to defeat competitors) as needed.
as an analogy, imagine if standard oil also had a financial operation that low-balled "normal" banks, intentionally losing money on every loan or instrument, just so those other banks blew up.
Right? That's the thing; it's not. Not by consumers, anyway.
Now, French book-sellers, on the other hand, appreciate the law that keeps them in business for aesthetic reasons, whether or not it makes economic sense or they can stay financially competitive when the price of data transmission has crashed past too-small-to-meter-per-word.
Indeed, Amazon's behavior isn't the same shape as a typical monopolist. Krugman wrote an article a while back about this that I think cuts to the heart of the matter:
No, c1b got it. The comment was open-ended, but I've definitely seen pushback on the way Amazon has floored the price on books. France sued the hell out of them for undercutting prices so deep that individual corner store retailers couldn't compete.
The biggest factor which is not considered in antitrust law is the fact that large corporations, by virtue of controlling a lot of capital, have access to a larger share of all the new money which is created out of thin air and injected into the economy as credit.
Economists are quick to point out that the new money which is created of of thin air is not given outright, but rather, it is loaned out - Therefore, by virtue of having to pay it back, corporations do not have an unfair advantage.
I disagree with this conclusion because an entity's access to loans is based almost entirely on how much collateral they possess - This necessarily implies that those entities which have more capital are able to take out bigger loans and thus derive more profits from these loans.
For example, if you have $100K in a particular asset (e.g. stocks), you can use that as collateral to borrow an additional $100K and you end up controlling $200K worth of assets in total.
So if the yield on those assets is 10% per year, you will end up getting 20% per year relative to your own capital. 20% of $100K is $20K.
So according to this principle, a company which has $100 million in assets can borrow an additional $100 million - This means that an asset class which can generate 10% yield can be bought on leverage to generate 20% yield on the initial capital.
20% of $100 million is $20 million. This means that $10 million of that profit was derived entirely from credit which was printed out of thin air by banks. That $10 million is free money and was given solely on the basis of existing capital.
This is why the rich get richer; it has nothing to do with value creation. Whenever banks print money out of thin air and inject it into the economy, everyone in the country who receives a salary in that currency ends up paying for that equally because of dilution in the value of their salaries.
In effect, this means that, salary earners and small capital owners are subsidizing big capital owners. This is what is fundamentally unfair about our financial system and why big corporations have to be limited; they're not successful because they're efficient, they're successful because they own more capital than everyone else and can thus access most of the newly 'printed' fiat money.
You can't just blame Amazon on loss of business for brick-and-mortar bookstores. In my country we don't have Amazon, yet paper book sales are decreasing because why buy if you can just download for free. And if you want to pay, it's just easier to buy online (ebook or paper). Not to mention that probably overall demand for reading books is decreasing.
I think there is an argument about wealth inequality there. Wealth that previously was distributed among local bookstores is now concentrated in a single company and it's shareholders. That's a pretty naive analysis, but I suspect Amazon's monopoly power has contributed to America's increasing wealth inequality.
This. Most booksellers could have just sold their bookstores years ago and bought shares of Amazon and done far better because they simply can't provide a faster, cheaper and better experience for their customers than Amazon can.
> because they simply can't provide a... better experience for their customers than Amazon can
That's debatable. If I want a specific book, sure. But Amazon simply cannot replicate the experience of browsing a bookstore looking for an interesting book to read. I cannot physically hold the book in my hands, flip through it's pages, maybe read a few excerpts, etc. And if I'm buying a used book, I can't inspect the actual condition myself before purchasing.
That's hard. What is the middle ground between encouraging innovation and healthy competition, and forcing companies to forego more profit in order to be good citizens and practice social responsibility? They should not be suddenly exempt from being part of a society.
Google's dominant market position was achieved through market competition not through impairing the ability of smaller companies to enter markets. Even in Google Chrome you can pick DuckDuckGo and Ecosia as your default search engine. Most of Chrome users probably never heard of those two search engines.
For example would YouTube be successful as it is today if it wasn't Google's resources and knowledge to skyrocket it? I think not.
When I think of harmful monopolies, I think that the worst ones are where a company owns a patent to a drug and refuses to sell it for less than 100x cost. But people every day can choose to type in any website into their search bar... and they choose to type Google. I don't see any reason why Google should be punished for that--unless they've done something bad elsewhere. It seems like a lawsuit will objectively make customer experience worse.
You really can’t compete against free. A large number of people use Google properties because they are free. Existence of a free product will pretty much decimate a large number of business models. Give it enough time and these companies will create gravity wells that start distorting society. Google’s network effects are so strong that as a consumer or a producer you cannot run away from them.
Want to use your own email server? Not going to be a piece of cake and good luck if gmail decides against you. Want to use firefox? Gmail and youtube really will move heaven and earth to make you use chrome. Want to preserve your privacy in any meaningful way? Good luck because rest of the society decided to hand over everything to Google and its free counterparts.
These companies gravity wells are so strong that they reduce meaningful choices to a consumer. In fact, give them enough time and they’ll coerce the market to behave in a particular way.
As of now, to operate as a business on the internet, you can ignore Apple, Amazon or even Facebook. You’ll have a tough time ignoring Google. Across the entire planet.
There’s no doubt that Google’s work has a lot of benefits to humanity. But that is not a license to ignore the dark side of the coin.
> Want to use firefox? Gmail and youtube really will move heaven and earth to make you use chrome.
What's that meant to mean? I use firefox, and I don't even see any suggestion anywhere on any Google properties to use Chrome, though there used to be something on the front page. Certainly never seen anything in gmail.
I agree that gmail is a disaster for people running their own email servers, though.
Google intentionally slows or cripples many of their products on Firefox - simply changing the user agent makes them load faster and have all their normal features. See: Gmail & Google Photos on Firefox desktop (painfully slow, fixed with user agent), Google Images on Firefox Android (functionally crippled, fixed with user agent).
Yes, indeed. And if Google is monetizing me, I don't equate that to being free. I can't tell you what I'm giving up, because Google does not share with me how much money they are making because of me.
This. As much as I dislike Google for lots of their practice. Monopoly isn't one of them. They won the Search Engine war because they were technically better. I guess most people dont remember the days of Yahoo and Alta Vista.
Look at the current pricing of medicine in US! Instead of going after those they decide to go after Amazon and Google. US is a place that many living outside of it could never quite comprehend.
There's some truth to this. For many years, Google allows users the ability to wholesale export all of their data (perhaps as a defense for this moment in time).
If the consumer market wanted an alternative, wouldn't there be competing companies by now that would ingest all that data and give you matching mail, docs, video, etc, services?
On the advertising front, Google is no longer the only game in town, so by definition not a monopoly.
> On the advertising front, Google is no longer the only game in town, so by definition not a monopoly.
Who are their competitors (I've not heard of one that isn't directly tied to a platform (a'la facebook))? How is the market segmented between Google and their competitors? If google had, as an example, 80% of the market share, it could still legitimately be considered to be a monopoly, even if it had 1000 competitors fighting for the last 20%.
For one thing, Internet advertising is still not a majority of all ad spending. Google is estimated to control about 1/3rd of the online market, Facebook about 1/4.
This reminds me of a Peter Thiel saying. Something like, when you're not a monopoly you lie to pretend to be one - "We're the only British breakfast restaurant in town" to attract investors. When you are a monopoly you lie to pretend not to be one by expanding your market - "We're a technology company".
Internet advertising may not be a majority of all ad spending, but Google is an internet ad company, not a general ad company. It would be like arguing the old phone company wasn't a monopoly because plenty of communication was still by mail or in person.
Below is a link to a list of mergers and acquisitions by Google over the last twenty years, many of them were search engines and online portals. This is the type of thing that the Antitrust Laws were meant to prevent. However laws are only as good as the government's willingness to exercise them. Hopefully this signals the end of the second Gilded Age, and a return to the creative destruction that has made the USA's economy the strongest in the world for almost a century.
Not a fan of creative destruction in the software sphere, personally.
In a lot of sectors, sure. I'm all for someone building a better car.
What benefit does mass competition in the software service space give me? How many bespoke APIs am I expected to integrate against to build something useful?
Different for difference's sake is the curse of our industry.
Everyone making a bespoke api is not the same as someone making a better car. Key word is "better"
The issue is that a lot of people talk up "innovation" in the tech industry, that isn't. For every person who makes a better car, lots of people make the same or worse cars.
As a random example, which format would you rather have your api serialization format be in: ASN, XML or Json? I for one am glad that innovation made ASN and XML go away.
> As a random example, which format would you rather have your api serialization format be in: ASN, XML or Json? I for one am glad that innovation made ASN and XML go away.
ha, obvs protobuffers.
[hides from thrown tomatoes]
Without creative destruction in software, there is no Linux, there is no GCC. So no Apple macOS, all PC's run Windows, and likely there is no iOS/iPhone.
Microsoft would also [1] own the internet. Their browser IE would be the only significant consumer share, there would be no Mozilla, no open source browser. So no incentive to open the browser up to plugins. Microsoft would hold all the information on consumer browsing habits. Would they permit other search engines? Unlikely if there is no antitrust regulation compelling them to do so.
But that was then. I think your premise is, we more or less have all the software technology we need why do more, unless it comes from an incumbent, in the form of incremental improvements? Why shouldn't Apple, Google, Microsoft shut down their app stores a little more? Keep the development in-house. What's the point of allowing this creative destruction from 3rd parties? More and more, we only get these increasingly tired, corporate innovations. Fewer ports on computers in the name of locking down devices to make them less 'hackable', more restrictions on these OS that increasingly feel like sandboxes, because why bother giving users the unfettered ability to create stuff, it just allows more creative destruction. Why should corporations knock it out of the park when they can just suppress upstarts with unfair competition?
By the way, antitrust regulation also prevents [2] Apple, Google, Adobe etc suppressing developer salaries. Remember antitrust law also shares incentives and motivation, to encourage progress.
But the better question is what is the future without without creative destruction, without shared incentives and competition? We have the answer in thousands of years of monarchies. Monarchies are a stagnant form of human development, they have no incentivize to upset their current order so they constantly suppress change. We don't celebrate this ancient monarchy or that one, like we do federated political systems. Compare the cultural developments in ancient Greece's federated city states vs surrounding empires. Or the Roman Empire, when it was ruled by the Senate, before emperors ran it into the ground. Or the Gutenberg Press, that brought printing to the European states where publishers were incentivized by profit, compared to dynastic China that developed the technology hundreds of years before, which helped trigger the Renaissance. Or Britain after the Glorious Revolution broke the monarchy's monopolies and led to the Industrial Age. Or the Jamestown settlement after it began profit sharing to motivate the colonists, in the face of failure, which directly lead to the political institutions which created the United States of America. Without power sharing, all civilizations degrade into inheritance systems, where opportunity is few and far between, unless you go rogue.
I was pulling a salary from one of those companies when that lawsuit went through about wage suppression, and I can tell you, my wage sure didn't feel suppressed.
Always felt a little gross to me that people who make six figures would claim their wages were being held down. It's not like anyone who felt they were underpaid or underappreciated didn't know where the other companies were. Don't get me wrong, I appreciate it and cashed my check for being apparently a part of an oppressed class, but at the end of the day very little changed and the biggest beneficiaries of the entire exercise were the lawyers who got the lion's share of the suit money.
On the topic of monarchies, there was plenty of creative destruction during the monarchy era. Territories and kingdoms were constantly being built, defended, fought over, carved up, destroyed, and rebuilt. Not all churn is good churn.
I'm certainly not against new companies innovating and creating new things. But I'm not sure in the specific space of software engineering, we need the heavy hand of government cracking up a successful company to enable creation of good things. I don't think the Microsoft antitrust lawsuit was a good idea, and it looks like history has borne that out; Apple got themselves out of their own hole by finding another operating system route separate from Windows and rearchitecting themselves on top of it, and Mozilla would always have had a home on Linux that Windows couldn't touch one way or the other. In the long run, all the lawsuit really seems to have done is force Microsoft into a back seat in they have arbitrary restrictions on the way they are allowed to combine their browser and operating system resources, and who benefits from that? Chrome has written an OS and a browser combined, why isn't Microsoft allowed to?
Better software tends to speak for itself. Do we trust government to make these decisions for the people who understand the technology and the people who use it?
> Even in Google Chrome you can pick DuckDuckGo and Ecosia as your default search engine.
And making this argument is exactly why they added search engine selection. They wanted to be able to point to this tiny insignificant detail that might cost them a negligible fraction of Chrome searches and hold it up as market competition when the inevitable antitrust suit came along.
Have you ever heard of a for profit company gifting traffic to their direct competitor? It would be irrational behavior in a competitive market. If anything this is evidence of Google’s search engine monopoly and Google built the selection feature into Chrome it in furtherance of that monopoly power.
>Have you ever heard of a for profit company gifting traffic to their direct competitor?
The #3 browser (Firefox) is (was?) massively funded by a half-billion-per-year agreement from the #1 browser's maker (Google) to add Chrome as the default search engine.
Sure, they could pull that deal. Unless you think it's a perfectly balanced deal, though, that feels like one for-profit company gifting traffic to their competitor (either Google giving money to Firefox, or Firefox giving traffic to Google).
It's more niche, but a lot of companies in my market donate to or fund their competitors for the sake of innovation and growing the pie.
Contrary to popular belief, for-profit companies (even those with scary board members in a competitive market) don't inherently have to be cutthroat.
I'm saying Google added search engine choice to Chrome in order to create the illusion of competition in a monopolized market. If Google didn't have monopoly power in the search engine market they never would have added search engine choice to Chrome in the first place for the same reason Starbucks stores don't sell bags of Dunkin' Donuts coffee beans. A rational enterprise in a competitive market doesn't benevolently give market share to a competitor.
Kind of like the cellophane paradox[1] I suppose. From Wikipedia:
> As Richard Posner wrote, "Reasonable interchangeability at the current price but not at a competitive price level, far from demonstrating the absence of monopoly power, might well be a symptom of that power; this elementary point was completely overlooked by the court"
But instead of a price denominated in dollars it's in consumer data I suppose.
Hm. If I understand the cellophane paradox, it says that the "substitutes exist" does not imply "there is no monopoly".
That seems different from your argument, which I understand to be "only a monopolist would make it easy for consumers to choose a competitor". But again, the conclusion that Google is a monopolist seems to be baked into this logic -- would you really say Google is not a monopolist if they did not offer search engine choice?
I agree with your statement. The comment I was responding to does not:
> If anything this is evidence of Google’s search engine monopoly and Google built the selection feature into Chrome it in furtherance of that monopoly power
IE being the mandatory browser played a big role in the antitrust suite against Microsoft. Afterwards they had to build controls to allow other browsers to be the default for the OS. Perhaps that played a larger role in the decision to allow the user to change the default search engine.
>> through market competition not through impairing the ability of smaller companies to enter markets.
So? In the real world, antitrust isn't about how a company became dominant. The fact that a company is dominant is what matters. Legislatures know that having a market run by one entity is inevitably a bad thing. Google's success, its market dominance, is the very harm that antitrust is meant to address. How Google got there isn't relevant.
If the government deems an organization too big, there is always something on which to hang the prosecution hat. Price fixing, tying, vertical restraint, dumping... they will find something.
> Even in Google Chrome you can pick DuckDuckGo and Ecosia as your default search engine.
And at the same time, they're taking steps to make it more difficult for Ad blocking software to be integrated into Chrome.
I'm glad they don't feel the need to bully other search engines out of existence, but that might have more to do with where their revenue comes from than any particular corporate morality.
> For example would YouTube be successful as it is today if it wasn't Google's resources and knowledge to skyrocket it?
You don't see the tight integration between Google's Advertising business and YouTube as a particularly unfair advantage? Are you sure they haven't operated at a loss on some or all of the product in order to bully smaller competitors out of the market?
Aside from the frontend code and the CDN, what is YouTube other than the advertising and other third-party integration anyways?
> Google's dominant market position was achieved through market competition not through impairing the ability of smaller companies to enter markets.
Googlebot was allowed to its thing pretty freely back in the day on the assumption that Google will remain a search company only and will not step on the toes of the companies whose websites it was parsing. That proved out not to be true.
What's more, if today I want to parse Google's web properties (let's say its GoogleMaps data) the same way that Googlebot used to parse the websites of the companies I used to work for I'll get banned almost immediately.
But, Android ships with chrome installed and set as the default browser, with Google as default search engine. And 99% of customers will never even think to touch those settings. You can't break into a market that most people don't ever realize exists.
If that would be true, Chrome would never become popular either. It's not a default browser on Windows, macOS or Linux. And yet people installed it anyway to the point it became the most popular browser. So your point of 99% people not touching defaults is nonsense. Even on Android Chrome isn't the default browser - Samsung Browser is (with Samsung being by far the most popular OEM).
Android isn't iOS where you're not allowed to replace the browser at all.
Well, everybody starts small and nice. Remember "do no evil". Then as the thing grows suddenly everything is changing and one day it can become a monster.
Yea it matters. If monopoly was achieved through market competition then fine, if it was achieved through destroying other companies then it is illegal and unfair. But once dominant market position is achieved company still needs to behave properly and not stifle competition.
Antitrust legislation is about keeping the markets competitive, because it also keeps them healthy. In that context, it doesn't matter if the monopoly position was achieved "fairly" or "unfairly", but only what effect on the market it has.
Coincidentally, this is also how legislation was implemented in this country until 1980s. Which is to say - this is what we did back when our economy was both prosperous and stable.
What would be valuable in the case of a monopoly that is achieved through market competition is to require the monopolist to help other compete as opposed to breaking up the monopolist. The former promotes competition to the benefit of the consumer and the latter promotes competition at the expense of the consumer.
Just following your argument down that road... What if one day there is only one company in the whole world? if they just slowly envelops all the other companies, and perhaps met your definition of this being legal and fair, would that be fine?
Gotcha. I would be surprised if the gov couldn’t find some incriminating emails though of executives talking about how to kill Bing when MSFT looked like it was gunning to be a search competitor.
Believe it or not Android was response to Microsoft's Windows Mobile(Windows Phone) and not to Apple's Iphone. Google was afraid at the time that Microsoft will release it's own "smartphone" and put Bing(Windows Live Search) as default search engine on it. But eventually Windows Phone killed itself and Google is good to go.
I wouldn’t go that far. The only reason that the justice department is going after big tech is because of the President’s personal dislike of the “left coast liberal elite”.
Don’t you find it strange that a Republican administration is going after a company for anti-trust?
I am not saying that Google hasn’t unfairly competed against small business or they shouldn’t be sued, but this is purely political, not the Justice Department all the sudden caring about the little guy.
> Don’t you find it strange that a Republican administration is going after a company for anti-trust?
Nope. If anything, there is past precedence from the 2001 Antitrust case against Microsoft [1]. Note in that case, it wasn't about whether consumers were directly harmed, but whether Microsoft was abusing its market power to prevent other entrants into the browser space. Arguably this is very analogous to what Google and Facebook are currently being accused of.
>> Don’t you find it strange that a Republican administration is going after a company for anti-trust?
>Nope. If anything, there is past precedence from the 2001 Antitrust case against Microsoft [1]. Note in that case, it wasn't about whether consumers were directly harmed, but whether Microsoft was abusing its market power to prevent other entrants into the browser space. Arguably this is very analogous to what Google and Facebook are currently being accused of.
The President, March 16:
>The Radical Left is in total command & control of Facebook, Instagram, Twitter and Google. The Administration is working to remedy this illegal situation. Stay tuned, and send names & events. Thank you Michelle!
I don't really see the problem with the current definition of a monopoly if consumers are saving money. The Europeans focus more on the sorts of effects you're talking about and they're far from famous for their efficient businesses practices or low consumer prices. Or is the idea that uncompetitive small businesses are valuable in a totally real but difficult to measure way?
I’m wondering if the focus is going to be on the search business or how Google stifles competitors on their search results page? I know Yelp for example has long claimed Google downranks their results over Google’s own reviews etc.
Neither of those interpretations really takes into account non-price effects of monopoly on consumers. Such as, say, crippling free ad-blocker plugins on the browser with the most market share.
IMHO they're not a monopoly, at least not in the traditional sense of the word.
Traditional monopolies "control supply of a good or service, and where the entry of new producers is prevented or highly restricted."
In this case, the supply of a good or service (social networking, webpage indexing and searching) are not controlled by Facebook and Google because they aren't finite resources. Anyone can index the web and anyone can build a social network and Google/Facebook aren't going to crush you with lawsuits or some other nefarious tactic to maintain their position (AFAIK).
Entry of new producers of these services is not prevented or highly restricted. New social networks and search engines pop up all the time.
What Facebook and Google have is massive, large scale user loyalty. Despite alternatives existing (Bing, Mastadon, DuckDuckGo, Myspace, etc.), users are voluntarily choosing to use Google and Facebook. This is not a monopoly.
The antitrust laws prohibit conduct by a single firm that unreasonably restrains competition by creating or maintaining monopoly power. Most Section 2 claims involve the conduct of a firm with a leading market position, although Section 2 of the Sherman Act also bans attempts to monopolize and conspiracies to monopolize. As a first step, courts ask if the firm has "monopoly power" in any market. This requires in-depth study of the products sold by the leading firm, and any alternative products consumers may turn to if the firm attempted to raise prices. Then courts ask if that leading position was gained or maintained through improper conduct—that is, something other than merely having a better product, superior management or historic accident. Here courts evaluate the anticompetitive effects of the conduct and its procompetitive justifications.
"Market Power"
Courts do not require a literal monopoly before applying rules for single firm conduct; that term is used as shorthand for a firm with significant and durable market power — that is, the long term ability to raise price or exclude competitors. That is how that term is used here: a "monopolist" is a firm with significant and durable market power.
> Then courts ask if that leading position was gained or maintained through improper conduct—that is, something other than merely having a better product, superior management or historic accident.
It seems like this is exactly what GP was saying...
"If you're not paying for the product, then you are the product" is how the old adage goes. If users are the product, then couldn't one argue that it's a monopoly over the supply of users?
I think this is a good point. Users are the product. From a typical consumer's perspective, there are other viable options for google-like services. From the perspective of a small business trying to target a specific audience with ads, are there viable alternatives?
I think economists are still happy to use the current term.
The Herfinadahl-Hirschman Index is a widely used measure of market concentration. It's calculated completely independently of how the firms in the market go about getting and protecting their market share.
If the HHI is high enough, and depending on how important the market is, this can be a sign that the market should be investigated to ensure that there aren't monopolistic anti-competitive or anti-consumer practices taking place.
Google is by far the biggest player in the search market (outside China at least), so I don't think an investigation is unjustified. There have been more than enough posts on HN and elsewhere about decisions Google have made over the years that show disregard for both competitors (not so much in search, but in other areas where Google has a footprint) and consumers.
No one can build a search engine as good as Google without the data flowing through it every day. That have so many click logs to train their models and see what works, there is just no way to compete.
If all Google engineers left at the same time, Google would still probably end up dominant by hiring new folks to get things back up and running.
No amount of human labor will be able to close that data gap.
The Google search engine didn't have anything to build off of when it was introduced since it was using an algorithm and not ML. You could create a search engine today without utilizing any click data outside of "what link did this user click on the result page and did they search for a similar query or try another link as their next action".
In fact, this is already happening. DDG is building its own crawler (I often see the ddg user agent on my web properties) and they don't have any open "machine learning expert" positions.
Sure, but when Google have been starting out they didn’t have to compete with...Google (as it is today). While companies that would like to enter the market now have to. And Google has a massive competitive advantage: their data and their scale. Not saying that regulation will necessarily help, and it’s not Google’s fault that they’re so good, but it’s silly not to admit that it’s hard to enter the search market today.
Now DDG is interesting. Their results are noticeably worse (YMMV). But they are using privacy as the selling point. I wonder if you can possibly have results as good as Google’s, or be as big and profitable as Google, while maintaining user’s privacy. I guess we’ll find out.
You're broadening the context. I am not saying Google as company is something you can't compete with. Many companies do so successfully in various markets. I am talking about search in particular. Which is why you bringing Microsoft in is convenient for my point. How's Microsoft's attempt to compete with Google search doing? And that's one of the few companies that can challenge Google in terms of resources.
Yes, broadening the context is my whole point. 20 years ago it was the OS, 10 years ago it was search, today it's social networks, tomorrow? The monopolies from each era struggle in the next. Let Google solve & dominate search while innovation moves on to the next big thing.
The history is antitrust rulings are what prevents monopolies of the past from dominating the next era.
IBM was constrained by an antitrust ruling. Which gave Microsoft an opening. Microsoft itself was then subject to a similar action 20 years later. So it's been another 20 years since then, so the time is ripe to clip googles wings.
That seems extremely short-sighted. There’s nothing stopping people from coming up with a better way to find what you’re looking for than Google’s search engine.
I just think any attempt would quickly be overwhelmed by Google pointing their data engine at something similar. Whatever your idea is, it will have to not just be slightly more data efficient at learning how to serve results. It will have to be millions or billions of times more data efficient. It doesn’t seem humanly possible to compete with.
What mechanism do you propose for keeping any one alternative frommsimply becomming the new abusive monopoly?
Railroads begat AT&T begat IBM begat Microsoft begat Google begat Facebook begat Amazon.
What some of us who've seen this rodeo a few times are beginning, slowly and dimly, to realise is that what we'd prefer is a healthy competitive marketplace within, sa, telecoms, chips, operating systems, publishing, search, retail, and the like. Simply crowning an endless succession of new storks as king of the frogs is losing its lustre.
This came up in the railroad era, the first big antitrust issue. Railroads were in a strong enough position to push up shipping rates. And push towns, and sometimes states, around. Pressure for antitrust action came from their customers, especially farmers, not from other railroads.
That led to the Interstate Commerce Commission and considerable price regulation.
Having the best product? Google and Facebook are just flat out better than Bing, Myspace, or duckduckgo for most applications. (Notice I said most, I get it, your super specific need does in fact fetch better results using ddg rather than google)
Platforms are defined as connecting two (or more) sides of a market.
There is a lot of economic literature in this space over the past several decades. Glen Weyl is pretty active in the area, as well as many known economists over the years.
It's not user loyalty that drives this, typically, but rather ease of ingress / difficulty of egress (adoption/switching costs) into the various platforms. Integration among common services helps too.
The economic definition of a natural monopoly is where firms have increasing returns to scale. That means where firms can produce more product per unit cost as the volume sold of that product gets large. https://cs.stanford.edu/people/eroberts/cs181/projects/1997-...
A good example is electricity -- it's super duper hard to put up electrical wires all around a country. But once the wires are up, it's not so hard to maintain them or extend them to cover more people over time.
Google and Facebook are perfect examples. The software engineer salaries ain't cheap to build their product, but once built the products can be scaled quickly at relatively low cost. Furthermore, their products' value itself has increasing returns to scale; the more people on a social network or using a search engine, the more valuable to advertise on them.
That’s a very simplified definition. I don’t think economists consider any market with significant barriers to entry and economies of scale to be a natural monopoly. From what I’ve seen, the term is usually used whenever the market actually has become a monopoly, or if it appears that the barriers to entry and economies of scale are so significant that the optimum number of firms is one.
The Scylla is scale, if you aren't big you can't do search at all, and only a behemoth like Google can do free-form AI assisted questions.
The Charybdis is trust. You can't monetize search directly, or it becomes a bunch of transparent lies that nobody wants. You can't be a rapacious predator that has already tried to eat the internet several times (sorry, Microsoft). It mattered that early Google said "don't be evil". You have to monetize something else, but weave it into your search so that you aren't bleeding money.
Only Google has threaded the needle. It may never happen a second time.
> IMHO they're not a monopoly, at least not in the traditional sense of the word.
The antitrust sense is about empirical control demonstrated by how markets respond in practice rather than the abstract theoretical potential you describe.
I don't have a problem with this. But I wonder why there isn't similar willpower to pursue, say, telecoms, banks, Monsanto, Luxxotica, Disney, and the like. Why is it just big tech?
What, you mean go after their friends? Are you crazy?
It’s complete nonsense. Telecoms have been fucking people over for decades and yet we still see mergers resulting in 3 providers going to 2 despite it being downright impossible to start a new one (see: Google Fiber), that is if you’re even lucky enough to have more than one in your region.
This is the biggest fear I have about antitrust. The reason Google is likely being targeted is because they have not stuffed enough pockets for most politicians to turn a blind eye.
Sure, some well meaning officials may enact useful policy to carve out a competitive space for smaller players. What everyone else, however, will learn is to stuff congress with more and more lobbyists.
Google fiber was fine. Google just stopped caring once they realized how little ROI is in the field. Turns out being a last mile ISP is a pretty low margin business.
Google Fiber was never about ROI. Fiber stopped expanding after encountering legal resistance in market after market from the preexisting telecom (take note the singular, because there’s usually just one). Every market they successfully pushed through, the existing telecom dropped prices and improved service to stay competitive. These competition-stifling monopolies are costing taxpayers tons of money when the taxpayers were the ones that funded the infrastructure the incumbents are holding out on now.
Big Tech has a corporate sophistication problem. The other industries are far more savvy when it comes to optics and fixing image problems. Remember Monsanto's reverse merge into Bayer that cleverly sidestepped the bad PR trail it received? That never caught up with them. It likely never will.
Sadly, I imagine that big tech will catch on. It has the resources. It's just still in the process of developing the playbook.
Telecoms usually pay for their monopoly privileges.
This is just a shakedown.
The same way Microsoft was deemed a "monopoly" and what? Unbundled explorer? Is anyone seriously worried about their monopoly now? There's always a new kid on the block.
The DOJ is too slow to be effective at targeting tech monopolies. They should just quit before they look like a bunch of johnny-come-lately blowhards.
Microsoft was specifically deemed a monopoly in desktop operating systems. That was OK. The problem was that they were trying to use that to "leverage" their way into dominance on the internet, by pushing (really quite aggressively) users to use Internet Explorer, and by pushing (even bribing) websites to include "IE-only" elements. "Try to make using Netscape a jarring experience" was the way they put it.
It's that "leveraging" bit that was the problem - trying to use a monopoly in one area to destroy competition in another area.
> The problem was that they were trying to use that to "leverage" their way into dominance on the internet, by pushing (really quite aggressively) users to use Internet Explorer
Absolutely correct. By the way, have you visited Google with a non-Chrome browser? They’ll encourage you to use Chrome for “the best experience.” Seems very much like leveraging, never understood why people don’t make a bigger deal about this.
Most people use Chrome already so they don't see how aggressive Google popup spams anyone not using it. Meanwhile, Microsoft tries a subtle reminder about Edge, and there's a media ruckus about it for days.
Telecom is a horse of a slightly different color though because they are intentionally granted regional monopolies over utilities. There should be better regulatory enforcement of these utility deals, but between regulatory capture and nearly trust-like brokered deals to swap regions among each other to best minimize any particular region's regulatory control and collusion opportunities between neighboring regions, almost all of the regulatory enforcement that should prevent certain types of monopolist behaviors has nearly no teeth left in the US.
The distinction is on which meaning of "monopoly" and "monopoly with respect to what". Yes, no telecom should be the only telecom in a region, but each telecom is granted an exclusivity (monopoly) on a particular utility line: cable companies are given (in most regions) exclusive rights to a region's originally TV focused fiber and coax cables and phone companies are given (in most regions) exclusive rights to a region's originally phone-focused fiber and coax cables. The convergence of all such lines towards data/internet-utility lines has let things like the Cable Act of 1992 declare a telecom not a monopoly with respect to a region so long as there is, for instance, a duopoly with a cable and a phone company. But there is still just one cable company with a (should be) regulated monopoly on cable lines and installations, and there is still just one phone company with a (should be) regulated monopoly on phone lines and installations. Those exclusive utility licenses themselves are still called and managed as intentionally granted monopolies for the public benefit (which is why they are regulated as such, and should be enforced better).
Yet even under this situation of "competition" between say a cable company and a phone company in most regions you have a duopoly and in very rare cases you find tripolies in the US. I did accuse these companies of swapping agreements in a friendly matter like if not exactly as a Trust to evenly distribute such duopolies and make it tough to enforce the places where the laissez faire regulatory environment around the duopolies have led to de facto monopolies by benchmarks such as which provide modern internet speeds at the neighborhood and/or building level. (It's been too long since the US was last interested in trust busting. It's also maybe been too long with the hand off the regulatory rudder for those cable and phone monopoly licenses.)
> Yes, no telecom should be the only telecom in a region, but each telecom is granted an exclusivity (monopoly) on a particular utility line: cable companies are given (in most regions) exclusive rights to a region's originally TV focused fiber and coax cables and phone companies are given (in most regions) exclusive rights to a region's originally phone-focused fiber and coax cables.
That's a weird way of phrasing it. Cable companies own their lines because they paid to build them. But they haven't been "intentionally granted monopolies" as you claimed above, because another provider could come in and build lines and provide service. (Power companies, by contrast, generally do have a monopoly in that sense.)
Most regions are aware that cable and/or phone lines form a natural monopoly, and thus intentionally granted that monopoly, placing regulatory bodies just as they did power, water, etc.
Just look at how badly Google Fiber is failing some cities to see how hard it is for "another provider could come in and build lines and provide service". It may be "slightly" easier to have competing cable providers than competing power companies (though keep in mind early America did have more competing power companies in some regions), but it's not that much easier, it's still a natural monopoly.
WorldMaker's answer to this comment is great. I would TL;DR it by saying that while there are always multiple phone companies to choose from, there is usually only one cable or fiber internet company, which is what matters.
In every state I've ever lived, for example, Comcast is the only company that provides acceptable internet speeds. DSL and satellite providers don't even come close enough to count as competition. So Comcast has the localized monopoly on the infrastructure necessary to actually provide a good product.
They are? Recent history suggests it's way easier for a random person to build a successful search engine (e.g. DuckDuckGo) than a successful telecom, and I have way more choice of search engine than telecom.
I definitely won't argue that telecoms play fair, but there are high barriers to entry for starting a telecom. If you start a new telecom only to compete for customers with an existing telecom in a certain area, you have to pay a huge expense to build out your network and your upside will be limited by the ensuing price war.
Not arguing that starting a telecom is easier than a search engine, but I think a large part of that difficulty is inherent to the industry.
You’re describing point by point exactly why they’re dangerous monopolies. It’s hard, incumbents have advantage, and even if you do it, incumbents will undercut you because they are already well situated. Consumers have no choice; incumbents frequently at the receiving end of the worst consumer satisfaction. Oh, and taxpayers also paid $400B to lay that infrastructure that apparently newcomers aren’t allowed to have. And yet here we are, going after a search engine that has a dozen alternatives that are just as capable of suiting your needs and new ones able to spring up overnight. It just makes no sense. This is pure manipulation by the government.
I definitely agree with you that they are dangerous monopolies, I hope I didn't come across as defending them.
I think the overall point though is that both the telecom and search engine market experience the network effect. In a telecom's case, the effect is more literal. For search engines, they increase in value as they can collect data on more and more users (which increases the value of the search engine to the users and the cycle continues). Saying that there are dozens of alternatives to me is like saying there are dozens of alternatives to Facebook. There are, but my Grandma isn't on them so do I really care?
I think that the network effect is really hard to regulate around effectively. Just look at Bell. the resulting companies from the Bell antitrust case are the same companies we are discussing as having monopolies on internet access. I absolutely agree that we have an issue, but I just don't know of a solution.
I disagree that the network effect in Google is anywhere near as substantial as Facebook. You don’t have a social network without your friends on it. You can definitely crawl the internet and make an index out of the cross references and build a search engine out of it. It may be worse at first but that’s because of the data you mine from users, right? So either this whole privacy thing is overblown and it’s really necessary to collect data to make a really great product or no one should be able to in which case Google holds little monopoly power over a newcomer that doesn’t have any of this data.
Not sure about the others, but by law no bank can have more than 10% of the national deposit asset, which makes it very difficult to be a monopoly. That's why the recent rumor of the merge of Wells Fargo and Goldman is just nonsense.
Anti-trust needs to come back in a big way to a Teddy Roosevelt / FDR level. Monopoly/oligopoly that causes too much concentration should be subject to regular anti-trust.
The biggest needing breakups are:
- ISPs / telecoms
- Banks
- Food supply
ISPs / telecom should be first, the 2017 push to remove net neutrality even with clear violations [1], privacy protections and focus on ad networks [2], data caps, throttling, prioritization and more are unforgivable. The network is a utility, it needs strong liability behind that. I'd rather the lines be run by power companies and in many places like Phoenix SRP runs all the fiber anyways [3]. Cox only ran lines when Google Fiber was here. All Cox does is overload nodes and upload is severely limited as well as prioritization is going overboard and ending up with dropped packets and a horrible QoE. While these systems have a decent QoS, the QoE is going down immensely. There are lots more things they are doing like trying to get their modems in while having access to remotely install firmware on approved but not rented modems and limiting/throttling by device when you get their shared modem/router that they can see every device.
"too big to fail banks" next which are a national security issue almost at this point. Mind blowing after the Great Recession that we let the banks handle this stimulus as a gatekeeper. The GR bubble was caused by mortgage backed securities that went into cause a credit crunch. Now we got whistleblowers coming out about commercial mortgage backed securities [4]. It is going to get bad.
With the pandemic, now the food supply has been exposed as too consolidated. Even hedge funds are saying it, when hedge funds are worried you should be worried as these are the wealth extractors [5].
Harvard Business Review recently raised the alarm about too much consolidation called "The High Price of Efficiency" and how there should be a 'rethinking efficiency' to reduce concentration [6].
> "Superefficient businesses create the potential for social disorder."
You can have too much "efficiency", it leads to stagnation and monopolies/oligopolies which stop innovating and turn to rent-seeking. Ultimately it leads to less innovation, less products, less jobs, monoculture, higher prices and missed opportunities when there is efficient competition but not super efficient markets. We need companies doing the same things and finding new ways to do things otherwise product development and research and development stop. The sales/marketing/finance takes over then from the product/engineering/creative people and we all lose.
Here's a great quick point by Steve Jobs about product stagnation and the managers/business side [7] and how they can run amok if not controlled to allow value creation to continue, and how monopolies or problems that arise when only the business/managers are in charge.
> It turns out the same thing can happen in technology companies that get monopolies, like IBM or Xerox. If you were a product person at IBM or Xerox, so you make a better copier or computer. So what? When you have monopoly market share, the company's not any more successful.
> So the people that can make the company more successful are sales and marketing people, and they end up running the companies. And the product people get driven out of the decision making forums, and the companies forget what it means to make great products. The product sensibility and the product genius that brought them to that monopolistic position gets rotted out by people running these companies that have no conception of a good product versus a bad product.
> They have no conception of the craftsmanship that's required to take a good idea and turn it into a good product. And they really have no feeling in their hearts, usually, about wanting to really help the customers.
The market is like a garden. The seeds and smaller plants need help, the overgrown and large plants should be harvested and culled back so it doesn't take over the garden and then the midsize plants flourish. Our market garden is in a state of overgrowth and the rest of the crops can't survive.
What happens when the overgrowth is taken over and efficiently worked out competition and created stagnation? How will there be competition in an oligopoly that is no longer US owned? It is a national security issue as well as a fair market matter.
It is in there under the "With the pandemic, now the food supply has been exposed as too consolidated. Even hedge funds are saying it, when hedge funds are worried you should be worried as these are the wealth extractors." [1]
Too much consolidation and waste due to super efficiency that is inflexible like code that is too coupled and specialized for a certain cpu over being flexible.
Right now pork is being wasted as slaughterhouses and meat packing has been reduced dramatically in the US since the 90s, larger facilities, less of them. Too efficient that it created a security issue and potential national security attack vector. Everything is not as localized, so there are choke points in our food supply that become massive backlogs.
>In 1977, the four largest meat processing firms constituted just 25% of the market, claims Bond. Today, they control 85% of the slaughter market, as well as some 35% of cattle ranches and around 65% of the entire chicken industry, he said.
> Since 1990, the number of slaughter houses, excluding poultry, has declined by 46%, from 2,709 establishments to just 1,461 establishments.
The antitrust lawsuit is focused on Google’s dominance of search. The specific question is whether Google has a monopoly on search. I think the case is pretty strong that it does.
How though? It's trivially simple to change the default search engine. Just because a product is dominant doesn't mean it got that way nefariously. I'm sure if you added up all the R&D over the years in search, especially considering the lead time in market, Google's numbers dwarf others (I don't have a citation on that, but it stands to reason).
Parallels could be drawn with Amazon and AWS's dominance.
Why is nefarious intent necessary? The rules for monopoly and abuse of market power don’t presuppose such negative motivations, just negative market outcomes.
>The rules for monopoly and abuse of market power don’t presuppose such negative motivations, just negative market outcomes.
Yes they do. The reason MS got put on the chopping block was because they began telling vendors that they would charge them more if they bundled Netscape or Java. Intel got slapped with a similar suite when they began telling vendors that they would charge more for their chips if they sold any configuration with AMD chips. Similarly Standard Oil did the same thing - once they began telling suppliers they would squeeze them out if they worked with any competitors they got broken up.
It's simply not enough to have a dominant position - you have to abuse it to get slapped with an anti trust suite.
I agree that negative intent from a monopoly power is actionable. I merely point out that negative intent is not necessary prior to regulatory action against or upon a monopoly power. I refer to another comment on this post for further info.
‘Courts do not require a literal monopoly before applying rules for single firm conduct; that term is used as shorthand for a firm with significant and durable market power — that is, the long term ability to raise price or exclude competitors. That is how that term is used here: a "monopolist" is a firm with significant and durable market power.’
These rules have changed before, and they can change again. Look up the history of anti-trust and the major shift that happened after judge Bork authored his paper. There's a popular argument that things went downhill from there, and we should reverse that decision. Since it was all about how the courts interpret legislation, this change can be reverted in the same way it was originally carried out.
AWS is not that dominant. Azure is half its size and GCP is a serious competitor. Not only that, there are plenty of companies you can go to if you don’t want managed services and just want VPSs.
Besides that, Amazon itself admits that only 5% of Enterprise workloads are on any cloud platform.
Any company - or heck most tech nerds - can build our infrastructure to suit their needs without going to managed services. Whether they should is based on their business model.
Before anyone tries to “educate me” about what AWS offers, I know the ins and outs of AWS.
Why is it dominant? Is Google is preventing competition from entering the market or is it because Google offers the superior product? Good luck with that in court.
Just because they don't stop their competition from entering the market would not change whether or not something is a monopoly. They have 88% of the US search market share which is often consider to be in the monopoly territory.
Of course it may not be prudent to go after a company that isn't doing any malicious against its competitors.
How would a government even go after a monopoly that isn't doing anything malicious against its competitors?
What would the punishment even be? Forcing adoption of other platforms to artificially inflate usage rates? Breaking Google Search into two competing Google Mini-Search products that aren't expected to cooperate and push search #3 and onward out of the market?
Yelp is a parasite that participates in extortion of small businesses. They need to be investigated themselves long before their word has any weight in this matter.
The antitrust lawsuit is focused on Google’s dominance of search...
Not principally:
Much of the states’ investigation has focused on Google’s online advertising business. The company owns the dominant tool at every link in the complex chain between online publishers and advertisers. The Justice Department likewise is making Google’s ad technology one of its points of emphasis. But it is also focusing more broadly on concerns that Google uses its dominant search business to stifle competition, people familiar with the matter said.
Google has an estimate 88% of the search market share in the US. (Its higher world wide if it matters.) Many people consider that to be getting into monopoly territory.
The big tech co's have become politically active by infringing on people's freedom of speech, etc. You can argue they're private, but that doesn't really matter. The telcos are private, but they can't drop your connection if they don't like what you are talking about. They can't drop the account of an organization that agitates for things they disagree with.
The big tech co's have made their bed, now they get to sleep in it.
Is it wrong if I'm kicked out a private club for saying something that offended the other members? Is the club's management obligated to allow me to continue expressing myself on their property, to their members?
Social media platforms and telcos operate at different layers of the stack. Even if something's acceptable at one layer, doesn't mean it's OK at another, because the consequences are different.
If an ISP allows someone to express something offensive (i.e. legal, but strongly disagreeable to the majority) on their network, it doesn't affect their other customers directly - they won't know or care which ISP this person was using. If a social media platform allows posting something that most other users would find offensive, those other users will leave. And yet people are arguing for deregulating the first (anti-net-neutrality) and regulating the second. It seems backward to me.
What you call "censoring" someone else might call "curation and removal of BS". The free market can decide whether it's too much or too little.
As some variant of millenial, I'm continually bemused by how many of my peers are on board with breaking up "big tech" and use "big tech" products multiple times every single day.
If I bring up federal contracting, which is an industry of comparable size, and which is dominated by companies founded well over 50 years ago [1], and which is way more politically opaque, and whose funding they cannot as tax-paying US citizens opt out of, the response is never anything more than "meh".
I understand that one is more relevant to daily in-their-face life. These aren't dumb people. They read, argue, write, vote. But the choice of what to agitate for is so odd to me.
As some variant of late 19th century man, I'm continually bemused by how many of my peers are on board with breaking up Standard Oil when we all rely on oil!
As some variant of mid 20th century man, I'm continually bemused by how many of my peers are on board with breaking up AT&T when we make phone calls practically every day!
etc.
(Also, point about federal contractors is pure Whataboutism)
Perhaps it's because the internet (and surrounding technologies) are so much more foundational to society. Without information moving freely and fairly, we'll mostly never learn about any of the other big problems that need addressing (of which, the one you pointed out seems perfectly valid).
Also, I think the average person feels more empowered with regards to shaping the future of the internet, than they do with something so entrenched, opaque, political and corrupt (IMHO) as federal contracting.
The first point makes sense, but it's hard for me to square with breaking up companies. I don't think any of FAANG has played a real censorious role on the internet. I'm just as free to spin up a random webpage to espouse whatever as I was in 1999. People move around the web differently, but I can still send it to whomever I want. I could also see an argument that AMP and similar technologies hurt journalism, but I hardly ever see that claimed.
If it's a question of agency, to me it feels much better to "vote with my feet" and not patronize companies I dislike than to write my congressperson and receive a form response from some intern. You may be right that people just expect better from the internet than federal contracting.
I agree. In believe such opinions are shaped mainly by the media. So I'd argue these people are in fact ill-informed and to be more blunt, not that intelligent after all.
I don't see this as "good is the enemy of perfect". I see federal contracting as a worse force for waste and bad outcomes than tech companies, so I suggest that targeting that industry would better improve people's lives.
Not every suggestion that we've misidentified a big problem is whataboutism. Especially when elected officials (in theory) look to their constituents to determine which problems to address/industries to threaten.
But it literally is whataboutism. If a friend of yours expresses concern about big tech firms, and then you say, "But what about this other industry?" you have not engaged at all with the original statement and attempted to shift the conversation to something else entirely.
Whataboutism is a fallacy when applied to moral arguments, not resource allocation arguments (which is what I at least read the OP as making). Everyone has a finite amount of time and resources for political participation, the DoJ (and every other prosecutor's office) has finite personnel and resources to devote to cases, etc. Unlike moral debate, choosing to protest/investigate some specific cause/company is a genuine zero-sum game because there are far more choices than there are resources to pursue them. Choosing one means not choosing another, so it's completely reasonable to question whether any given choice is providing the best ROI. That's a genuine major part of a prosecutor's job description, and it applies to citizens too. It's quite possible to put in a ton of time and effort and achieve nothing because it was a bad approach.
We seem to disagree on what the original statement is.
When I talk to my peers, the original statement is some version of: "big tech is the most harmful monopoly in the USA today". Saying "what about monopolistic industry x?" is directly engaging with that statement.
It's possible that I'm conflating people's decisions to prioritize talking about tech companies with their actual priorities for which industries require government intervention.
You’re moving the goalposts. This article doesn’t say big tech is the most harmful monopoly in the USA. You made a top level comment so you weren’t responding to anyone, either.
This is an article about the justice department potentially bringing antitrust charges against Google and you made a top level comment saying “what about this other industry?”
This is whataboutism. As clear as the day is long.
I see. I'm interpreting the DoJ's choice as a claim that Google is the most harmful monopolist in the US, since they've chosen to go after Google (and not anybody else). That's why I wrote my original comment. However, that's not actually stated in the article.
I think my interpretation is reasonable, but I get why it's whataboutism in a discussion of the topic "is big tech monopolistic?".
A take: monopoly in tech is good. Because Google/Amazon/FB have so much money they can do things that push tech forward as a whole. Think about the revolutionary improvements Google has made towards data centers, AWS, and all the research/open source contributions these companies have done.
Unlike other monopolies (telecom, defense contracting) etc. where the monopoly is used to stagnate innovation (see Comcast being terrible), here the monopoly leads to more innovation. Smaller companies can't embark on Google-sized projects.
Sidenote: I'm pretty sure this lawsuit is just a political attack. It seems reasonable that other monopolies in healthcare/defense/etc. are much much worse, yet they aren't "liberal"/"blue" companies, so there are no lawsuits.
Disclosure: I'm interning at Google. I don't think this matters at all, but someone called me out on this in the comments.
Google/Amazon/Facebook have each served to stagnate tech, not push it forward. If you read their headlines, sure, you'll believe they're doing groundbreaking things. But in reality, these behemoths have killed thousands of innovative startups to protect their cash cows. The uncommitted experiments they run, meanwhile, never amount to anything useful for the world.
There were better social networks than Facebook, but they didn't make money the way Facebook does, so Facebook bought them and killed them. There were better online stores than Amazon, but they didn't abuse humans and play the same games Amazon does to succeed, so they died and it won. Tech monopolies are monopolies, and they're particularly aggressive ones.
I also don't think you grasp the scope of tech monopolies. You cannot operate a business today without doing business with Google. You can hate Google, but you still have to do business with Google. Because if you aren't putting out Google Ads or at least optimizing your SEO for Google's bots, if you aren't launching your app in the Play Store, you're cutting off the majority of your customer base, and you're dying.
Healthcare has to do business with Google. Defense has to do business with Google. Effing Comcast has to do business with Google. There has never been a monopoly on this planet that had more power and that was so unavoidable. And it doesn't take a lot of research to find places people are being hurt or having their livelihoods taken by the unholy beast that it's become.
Obviously healthcare providers market to consumers, medicines are marketed to consumers even when they're supposed to be prescribed by doctors, and of course, marketing healthcare wares to doctors is a pretty big deal.
But ask yourself how healthcare companies and defense contractors market themselves, find new talent, even lobby. (Targeting advertising can literally shove ads just in the face of people in federal government buildings.)
Google has the eyes of well over 80% of the global population. Which means if you want to talk to... pretty much any group of people, you likely have to do it through Google.
This is very well put. I've worked in tech for both startups and corporations. I've moved around a lot and I've come to the same conclusion.
The effects of tech monopolies are particularly obvious to those who work in open source.
For example, it's extremely common to find that some very expensive third-party services have free open source alternatives available - These open source communities are often struggling to stay alive. Big tech corporations hire thousands of engineers in-house and so it would cost them nothing extra to use the open source solution (they already have the engineering capacity to implement and manage it). But they won't! They will happily pay millions of dollars of fees annually to get something that they could have gotten for free and maybe paid an optional $20K per year 'tech support' fee to the open source community. Not only that, but their system would be way more flexible because the corporation would have full control over the open source code and their own data. For example, the $400 million that Facebook spent on acquiring Giphy could have been saved if they had used an open source solution instead. Heck, they could have built Giphy themselves from the ground up in a couple of months using open source solutions for very little additional engineering cost.
Corporations have no incentives to be efficient; instead they will use some expensive provider because the CEOs of both companies are friends. They have a monopoly so they can afford to be very wasteful.
The innovations you mention are all addressing issues that only huge tech giants like Google have anyway. And they are all funded by the ad-supported business model, which IMO is a negative that outweighs those positive contributions.
Plus, the ad supported business model means users only get the benefit of any innovations Google makes when it increases Google's ad income. That incentive is not well aligned with the needs of users. How many times has Google discontinued a popular application because it wasn't making them enough money? A company in Google's position is exactly the company that could figure out how to get a billion users to pay them directly for services those users want, instead of using their eyeballs as commodities, but Google has put zero effort towards that highly desirable innovation.
We also don't see all the innovations that are not happening because the people that would have made them are being paid by Google and other tech giants to look for new ways to capture more eyeballs instead.
> I'm pretty sure this lawsuit is just a political attack. It seems reasonable that other monopolies in healthcare/defense/etc. are much much worse, yet they aren't "liberal"/"blue" companies, so there are no lawsuits.
If this hypothesis were correct, we would have expected to see lawsuits against those other monopolies during, say, the Obama administration. But we didn't.
The lawsuit is specifically stated in the article to be targeted at the ad-supported business model, so the obvious inference is that all the issues with that business model that have come up over the years have finally built up enough political pressure that the government feels it has to do something about it.
> If this hypothesis were correct, we would have expected to see lawsuits against those other monopolies during, say, the Obama administration. But we didn't.
This presupposes that the DoJ has always been a political weapon.
> This presupposes that the DoJ has always been a political weapon.
Of course it has. Look at the war on drugs and lack of prosecution when democrats enter power. Both parties use the DoJ to push their own agenda and perception. Frankly the expectation that the DoJ be non-partisan (much like the supreme court!) is naive and the democrats cripple themselves by even articulating this expectation.
> This presupposes that the DoJ has always been a political weapon.
No, it only presupposes that if the DoJ is going to be used as a political weapon, any administration, of either party, is about equally as likely to use it as any other. Given the general track record of the Federal government, this seems like a much more plausible assumption than your implicit assumption that it only started being a political weapon just now.
> A company in Google's position is exactly the company that could figure out how to get a billion users to pay them directly for services those users want, instead of using their eyeballs as commodities, but Google has put zero effort towards that highly desirable innovation.
Fwiw Google has tried this more than once. It's just that the value that advertisers get is way higher than the value that consumers get.
There are specific search terms that can go for more than $50 ad bids. Individuals can't really pay for that much. Like how much would you be willing to pay for Google search each year?
> If this hypothesis were correct, we would have expected to see lawsuits against those other monopolies during, say, the Obama administration. But we didn't.
This only follows if you believe the Obama and Trump admins are equally corrupt.
> Smaller companies can't embark on Google-sized projects.
What do you mean by "Google-sized projects"? Google is made up of many differently sized services. And a lot of the services that Google provides have smaller companies that provide competing services. One of Google's advantages is that it can subsidize the cost of smaller services with it's cash cow.
Monopolies are always harmful for the functioning of society. Google has crushed thousands of small companies. Also they have quite some power, for example they can simply delist your companies website from their index and your customer base is gone.
I doesn't matter if other things are much worse in other branches. They should also get punished.
Google forces you to work solely with google, E.g (from the antitrust investigation of the EC:
Google required direct partners to exclusively use Google's AdSense and could not engage with Google's competitors;
It is actively disadvantaging the competition:
>Google does not apply its system of penalties, a predefined set of parameters to lower the placement of shopping results, to its own Google Shopping results as it did to other competitors.
>yet they aren't "liberal"/"blue" companies, so there are no lawsuits
And this is off the track in my opinion. In Europe Google also has problems with the European Union, do you think they are liberal or conservative on your scale? Google deserves some punishment for how it behaves. It is doing actively damage to society. Do not evil has long be gone.
This is going to give bad points again, but may I say that I find the amount of polarization in your country distasteful? And that is an understatement. I think you shouldn't divide your country into two compartments, you are all in the ride together.
It will weaken you in the long term and your country is actively exporting these ideas. So in Europe polarization is also growing. It is a dangerous matter thinking into sides like this.
It sounds like red is evil to you and blue is good. Watch out for that. Watch out for that.
I don’t think comparing monopolies across industries is justification for a monopoly in tech. A more telling comparison would be monopoly in tech vs no monopoly in tech.
Alright it's disclosed. I'm not opposed to disclosing (I'm assuming you know b/c it's been mentioned previously in my profile). But also, I had this viewpoint well before I decided to work at Google this summer for an internship.
> Disclosure: I'm interning at Google. I don't think this matters at all, but someone called me out on this in the comments.
It matters because it shows you have financial interests which may bias your opinion. Not to mention if you are interning at google, you have very little experience in and knowledge of the tech industry.
The big problem with this is the extreme mediocrity of every other industry. Amazon and Google are winning everything because none of their competitors have even attempted to do better than they did 10 years ago.
Amazon should have won in very few of the markets it entered. Instead, its competitors just decided to lie down and die, with a couple of yelps on their way to their death.
Google is partly winning because many sites are now hostile to crawlers other than Google's.
If we want real competition in the search engine space, Google's crawl should be opened up as a "common crawl", accessible to any company that wants to pay a nominal sum to access it for building an index.
> Amazon should have won in very few of the markets it entered. Instead, its competitors just decided to lie down and die, with a couple of yelps on their way to their death.
Once AWS started really making money, there's not many companies that could realistically beat Amazon. How do you beat them when they can use tactics like what happened with diapers.com? How many companies can afford to run what is likely their main revenue source at a $100,000,000+ loss every three months just to keep Amazon out of a market that wouldn't even be a top 5 revenue stream for Amazon?
I'm curious why you say this.
I spent the past two weeks using Bing (which is the source of DDG results, but a little faster and more accurate). For most queries it was fine (finding things on Wikipedia), but last weekend I got into a project that required a lot of css and html (not my day job). There were a lot of cases where the search results were not even close to the thing I wanted. The experience led me to switch my default browser back to Google.
Oh is this the case? I thought their results came from Yandex. I don't really want to have a Yandex account to get my site indexed, so if this is my out I am all about it.
Try using bang syntax for more specific results. Ie: append `!so` to search Stack Overflow, etc. It's similar to Google's `site:stackoverflow.com` but much nicer.
'Both the Justice Department and a group of state attorneys general are likely to file antitrust lawsuits against Alphabet Inc.’s Google—and are well into planning for litigation, according to people familiar with the matter.
'The Justice Department is moving toward bringing a case as soon as this summer, some of the people said. At least some state attorneys general—led by Texas Attorney General Ken Paxton, a Republican—are likely to file a case, probably in the fall, people familiar with the matter said.
'Much of the states’ investigation has focused on Google’s online advertising business. The company owns the dominant tool at every link in the complex chain between online publishers and advertisers. The Justice Department likewise is making Google’s ad technology one of its points of emphasis. But it is also focusing more broadly on concerns that Google uses its dominant search business to stifle competition, people familiar with the matter said.
'Details about the Justice Department’s legal theories for a case against Google couldn’t be learned.'
> 'Details about the Justice Department’s legal theories for a case against Google couldn’t be learned.'
That's what it seems like to me too.
I understand a popular opinion is that Google is too big, should be broken up, etc. But I really don't think there's a prevailing justification. Or examples of competition that they've supposedly stifled? This stinks of politics.
> The company owns the dominant tool at every link in the complex chain between online publishers and advertisers.
The same could be said about Apple - they have the dominant (actually, the only tool) at every link between iOS developers and iPhone users.
I think the case is weak. Google's a big company, sure. They're the most popular in many areas. But what about that requires anti-trust, compared to hundreds of other companies that check that same "most popular and big" box?
Yes, and Trump has threatened Google explicitly before.
For example:
> Google search results for “Trump News” shows only the viewing/reporting of Fake News Media. In other words, they have it RIGGED, for me & others, so that almost all stories & news is BAD. Fake CNN is prominent. Republican/Conservative & Fair Media is shut out. Illegal? 96% of results on “Trump News” are from National Left-Wing Media, very dangerous. Google & others are suppressing voices of Conservatives and hiding information and news that is good. They are controlling what we can & cannot see. This is a very serious situation-will be addressed!
> Q Do you think that Google should be investigated?
> PRESIDENT TRUMP: Yeah, I think Google has really taken advantage of a lot of people. And I think that’s a very serious thing, and it’s a very serious charge. I think what Google and what others are doing — if you look at what’s going on at Twitter, if you look at what’s going on in Facebook, they better be careful, because you can’t do that to people. You can’t do it.
> We have tremendous — we have literally thousands and thousands of complaints coming in. And you just can’t do that. And so I think that Google and Twitter and Facebook, they’re really treading on very, very troubled territory. And they have to be careful. It’s not fair to large portions of the population.
The case against Google is "whatever we can throw together to pressure them to stop pushing end-to-end encryption we can't break". Google is by far the biggest proponent of this, and they have both the most popular browser and some of the most popular sites on the Internet, so they can very easily do so.
Whether you think Google is a monopoly or not, and whether you think they've done harm with that monopoly or not, I think this case is going to do net harm to Internet security.
I don't see how you can consider Google to be "by far the biggest proponent" of end-to-end encryption. What Google products even use end-to-end encryption? Duo and Chrome sync are all I can think of.
Even Facebook has end-to-end encryption in WhatsApp and says it's coming to their other messaging products which is far more than Google does.
Google doesn’t even use end-to-end encryption for its consumer facing stuff. It’s against their whole model of scanning content for keywords to eliminate spam, improve advertising, etc.
Google has done a great deal of work to push and early-adopt new web security standards, including QUIC (which inspired HTTP/2 and became HTTP/3), by changing the Chrome browser, Android, Google services, etc. They've also heavily pushed Certificate Transparency. And they've pushed for device encryption, as well, on both Android and Chrome OS. Those and many others are technologies that better support a web without backdoors and devices without backdoors.
I'm not necessarily suggesting that they've done the most work in all those areas, and many others are doing critical work, some of which should get a lot more attention than it does. But Google is literally the biggest proponent, insofar as they can push it the most quickly because they control the most endpoints.
I will continue to believe that this is another tentacle of William Barr's political harassment of Google and tech in general until he leads the same crusade against other 'monopolies' of the same degree like Comcast, Apple, Boeing, Amazon, United Airlines, etc.
Not saying google isn't a monopoly, it classically is, same with facebook. But I wonder if Goog wasn't a majority "blue" company would he aggressively go after them. The problem is there are so many oligarchy's controlling industries. Chips, well its a two or three company game(intel, amd, ARM). Lets look at airlines, well its united, delta, american etc. Communications(cell phones), ATT, Verizon, Sprint/Tmobile. America is increasingly becoming a land of large companies controlling industries where the consumer almost always loses, think higher prices due to less competition. I point out google/facebook as they are the only companies in their space (search, social media) that control more than 75% of the space by themselves.
The government intentionally created the Airline oligopoly by banning foreign airlines from operating domestic flights in the US, and further by allowing United, American and Delta to form joint-ventures with foreign airlines to control prices/schedules between continents.
Is Google really a monopoly? Many people use Outlook, iPhones, Apple Maps, AWS, Bing, HERE maps etc...
The antitrust investigation is focused on online advertising. So Outlook, iPhones, maps, AWS doesn't really apply there. "Many people" might use Bing, but Google dwarfs it in market share.
I'm not particularly familiar with the infrastructure of the ad business, but my layman's view is that alternatives are slim outside of Google for search engine and the more general web and Facebook for specifically social media.
> The antitrust investigation is focused on X so Y doesn't really apply there.
Antitrust prosecutions are heavily dependent upon shaping the "market" which supposedly is being monopolized.
There is no good argument for antitrust against the Apple App Store if the market is "all transactional marketplaces where software can be purchased", but there is a good argument if the market is narrowly defined as "all transactional marketplaces where software can be installed onto iOS mobile devices".
Look for similar shaping of the market by both sides (the prosecutor will attempt to narrow the market and the defendants will attempt to broaden the market).
Also worth noting that Amazon already chipping away at Google's market share dominance in online advertising[1]. By the time the DOJ's prosecution goes thru the courts, the market is likely to be significantly changed from where it was when AG Sessions (who started these investigations) started crafting an anti-tech-giants strategy.
> "all transactional marketplaces where software can be installed onto iOS mobile devices"
This is clearly the case though? The App Store doesn't sell, say, Windows software, and iOS devices refuse to run software from (for example) the Google Play store.
Yes it's clearly the case, but it's not clear that there are any market benefits by the government forcing all app stores to sell all software, irrespective of the platform the software runs on. This would effectively deny all businesses the ability to work just in their niche/forte and destroys the "competitive advantage" (economics term) of most/all businesses.
Actually its worse that I thought!
Google controls 91.89% of the search market [1]
G controls 68% of the browser market [2]
G's android is on 84% of phones operating systems [3]
G has 73% of the search advertising market [4]
These numbers are really scary, if you care about fair competition and a just, balanced society.
Exactly. The Federal government speaks out of both sides of it's mouth. If monopolies fail to spur innovation as is suggested by many, then regulatory burdens such as the Jones Act do even more explicitly.
Is there something fundamentally wrong with creating the Airline oligopoly though? Maintaining domestic ability for commercial airline traffic seems like a smart idea. Having a singular search and ad network company doesn't.
I think the snarky response here would be “When did Google buy Facebook?” If you’re willing to restrict the scope of the “internet advertising market” to just specifically the things that Google dominates, then duh, Google has total control of “internet advertising”. And yet, there’s another multi-hundred billion dollar company that makes most of its money by advertising on the internet. Scoping markets in this way is nonsense. It a marketer wants to market products on the internet, are they going to put all of their money into Google because it’s the only way to advertise on the internet? Obviously not. And further, therefore there is obviously not a monopoly.
> America is increasingly becoming a land of large companies controlling industries where the consumer almost always loses
Increasingly? When wasn't that true? You have to go back to pre Civil War, where the economy was heavily geographically split due to movement/transport limitations, which mostly voids the discussion (it was very much a local and regional, agriculture-heavy economy, with limited manufacturing and a very limited consumer goods market as we know it today; not very comparable to anything that exists now). Once you get near to or beyond the Civil War and firmly into the industrial era, the combinations begin essentially immediately and they dominate their segments rapidly. Vanderbilt got so rich by aggressively creating monopolies in his day, in transport. It was far more brutal than anything you can imagine today, in all respects including the options/alternatives that consumers had. From US Steel in 1901 to the few giant railroads to Standard Oil to American Tobacco to the couple remaining giant auto companies (eg GM, Ford, Chrysler) that survived that industry's shakeout in the following decades. Further, you had a small group of industrialists and financiers that cross-controlled everything regardless (and they had few laws limiting their behavior), as with eg Rockefeller heavily dictating terms with the railroads to crush his competition.
Leap forward in time: Sears, PAN-AM, IBM, General Electric, General Motors, Ford, AT&T, US Steel, US Rubber, Bethlehem Steel, Armour & Co., Kodak, Polaroid, a very small number of giant media companies like CBS, and so on.
Yesterday was dominated entirely by massive corporations. It doesn't matter what decade you select. Whether it's 1910, 1950, 1980, or 2020. It wasn't better in the past.
Markets always do this consolidating naturally. Your only option to prevent that is to use the government to prevent or interrupt it.
This is an excellent point. Markets consolidate because mega-corps enjoy massive economies of scale. Do people remember what e-commerce was like before Amazon? You waited a week to get products in the mail. It was Amazon’s massive scale that made next day free shipping possible.
*Free with purchase: There's a membership fee and inflated prices for Prime. I'm glad for the competition since multiple retailers drastically improved their offerings.
> America is increasingly becoming a land of large companies controlling industries where the consumer almost always loses
I stand by this statement, here is a more detailed argument, its from 2018 but still has lots of information about consolidation and how it has become alot worse recently, say the past 30 years:
https://beta.trimread.com/articles/16432
> Not saying google isn't a monopoly, it classically is
Most people I've seen equate monopoly with "95% of people use", which really isn't a monopoly. As far as I'm aware, dominating a market is not the sole criteria of a monopoly (although I am aware it is a sign of successful one, correlation/causation).
For someone who doesn't follow this kind of thing, can anyone point to concrete examples of "no other company does this" monopoly or "actively stifling competition" anti-trust practices taken by google without just scoffing and saying its obvious?
It's a monopoly (or monopsony) if it's prohibitively difficult to function in the market if you refuse to do business with them (or, more commonly unless a regulator is currently assessing monopoly status, they refuse to do business with you).
For example, Google doesn't have a monopoly on search; I can use DuckDuckGo just fine (although patent trolling complicates this a bit). Google does, however, have a monopoly on search traffic; if Google delists your site, it has effectively disappeared from 90+% of peoples' (mis-)conception of the internet[1]. A government the purports to support a free market must[0] regulate the latter case.
0: in the sense that not doing so directly communicates that they do not in fact support a free market
1: and this could be true to a lesser degree even if it had only, say, 45% market share
Edit: there might also be regulations that should apply to de-facto infrastructure like search engines regardless of monopoly status, but those are, by specification, not based on monopoly status.
> Google does, however, have a monopoly on search traffic; if Google delists your site, it has effectively disappeared from 90+% of peoples' (mis-)conception of the internet[1]. A government the purports to support a free market must[0] regulate the latter case.
As much people talk about Google's monopoly, I've not seen anyone bring up this point, which is what I was talking about in my previous comment. And I would absolutely agree with you that this could represent an issue of abuse of your position in the market. Would the next step be to prove this abuse occurs? For instance, if I google "maps" I'll get google's maps first, for sure. But I'll also get apple's maps, bing's maps, open map, and mapquest on the first page.
> But I wonder if Goog wasn't a majority "blue" company would he aggressively go after them.
"Majority blue" is in a majority of their employees vote Democrat? That's just what happens when you're headquartered in California, in a metro area, with a workforce that skews younger.
I don't think that Google is somehow pushing liberal objectives in a meaningful way.
Google checks all of the boxes to be an enemy of conservatives in America’s current culture war, even if they have no particular interest in fighting a culture war. Previously they could have relied on protection from the faction of the conservative movement that defaulted to respecting large successful American businesses, but that faction has been seriously weakened. Ever since Google fired James Damore for writing an anti-diversity memo conservatives have been out for blood.
> I don't think that Google is somehow pushing liberal objectives in a meaningful way.
But true or not, it is perceived that way by those who are aggrieved (social conservatives in the USA)... which is what your comment's parent was discussing.
I'm not disagreeing with your comment, but you aren't disagreeing with your parent comment either.
Google consistently makes headlines for culture war stuff from the blue side, it's the perfect foil for Trump.
It doesn't matter if they're biasing search results or not, that's complicated anyways, highly visible culture war stuff is what his audience is primed for.
Google also controls Youtube - an important political battleground. Conservatives have been overtly critical of "censorship" and critical of social media "deplatforming" of certain personalities (on the political right). Expect this consideration to be in the minds of YouTube & Google executives as they navigate this political minefield, intended or not.
A study showed that Google News returned links to CNN vastly more often than links to Fox News, even though Fox News has triple the market share of CNN.
> How else to explain why Google has restricted more than half of our 15 videos that are pro-Israel—even one by former Canadian Prime Minister Stephen Harper?
Google may or may not be doing this intentionally; it may be some byproduct of the algorithm plus unconscious bias from left-leaning Googlers. But the result definitely pushes liberal objectives. Your typical Googler reviewing YouTube videos living somewhere like San Francisco simply isn’t equipped to figure out what is and isn’t within the mainstream of acceptability.
Might be based on user preference influencing weighting for search results. I've know I've personally done all I can to block Fox News and other low quality sources from Google News.
Or, it just the people doing the algorithm decided to rank Fox News lower than others. I have noticed that Fox news is showing up more on Google Top News RSS feed after commotion started to be made.
And, come on man. Seriously, every news network except Fox News for the past almost 3 years pushed the Russian collusion narrative and it's turning out to be almost the exact opposite. So, you really need to rethink what you view as quality news. I'm not saying that I think Fox News is the best quality, prefer Bloomberg to be honest.
Just because you don't agree with political ideology of a news network doesn't mean it's low quality.
Fox News is by a large margin the #1 cable news network. If search results were weighted based on user preferences you’d expect it to show up more, not less.
There might be less overlap between people who passively leave their TV running on Fox News and people looking up articles on the internet than you think. It's ranked #21 in News and Media sites[1]. CNN is ranked ninth, so actually it'd be pretty questionable if Fox News were returned in search results more than CNN.
Why is that the correct metric to use? CNN is a global news outlet, while Fox is primarily domestic. Unsurprisingly, CNN ranks highly on a measure of global website visits. What does that have to do with preferences in the US?
I mean, one possibility is that Google’s algorithms are causing the politics of web site visitors people in France to affect the search results of people in Kansas. That seems like an unintentional form of pressing liberal agendas.
You can drill down into US traffic, sure (and I'm sure Google delivers results that are ranked appropriate to region), but Fox still doesn't win there - it's beaten by Huffington Post, CNN, Google News, and Yahoo News.
Note that "cable news network" is an important qualifier in that statement. The network newscasts (ABC, CBS, NBC) each see 3x Fox's news programming viewership.
> Barr is a longtime proponent of the unitary executive theory of nearly unfettered presidential authority over the executive branch of the U.S. government.
> Barr as attorney general in 1992 authored the report The Case for More Incarceration, where he argued for an increase in the United States incarceration rate
> Having criticized the Mueller investigation before taking office, Barr did not recuse himself from overseeing the investigation as attorney general. After receiving Mueller's report he issued a four-page letter to Congress, describing what he said were its principal conclusions, and adding his opinion that the evidence presented did not establish obstruction of justice by Trump. Special counsel Mueller privately responded that Barr's letter had misrepresented the report.
> Barr intervened in the criminal case against convicted Trump associate Roger Stone, recommending a lighter sentence for Stone than the career prosecutors who had worked on the case. In May 2020, the Justice Department under Barr announced the dropping of charges against ex-Trump adviser Michael Flynn despite an earlier guilty plea by Flynn, which he later filed to withdraw.
So yeah, he's a hatchet man for the president, through and through. This is just revenge for tech's left leaning donations and stance, at the bidding of Trump of course. Big tech has long been in the sights of conservatives and this is just another shot in what's been a growing conflict.
As someone who is on the liberal side on incarceration issues: what does arguing in favor of higher incarceration rights have to do with being a “hatchet man” for the President? Especially when the President in question has made strides in reducing mass incarceration that even Vox had to admit were extremely significant: https://www.vox.com/future-perfect/2018/12/18/18140973/state... (
Bush senior was big on incarceration and the war on drugs was a central tenant of his platform. It's pointing out that he [Barr] has a long history of doing what the President wants for political purposes.
Is it? Or is it evidence that Barr is a traditional, religious, law-and-order conservative, writing at a time when law and order was in vogue even among Democrats? It should be noted that in 1992, the increase in crime rates compared to 1960 was still significantly larger than the increase in incarceration rates over that same period. (In 1992, crime rates had increased by a factor of 5x, while incarceration had increased by a factor of 3x.)
Likewise for your point that Barr endorses a theory a unitary executive. So do many people. What does that prove? It’s not a controversial idea. The very first sentence of Article II of the United States Constitution says: “The executive Power shall be vested in a President of the United States of America.” It doesn’t even say something like “there shall be an executive branch and the President shall be in charge of it.” It vests the executive Power (capitalization in original) in a single person. Article I and Article III, by contrast, “vest” the legislative and judicial powers in institutions (Congress, and the Supreme Court). The choice of phrasing appears pretty deliberate. And notably absent from Article II is any mention of career bureaucrats who can exercise the executive Power" of the United States independently of the person in whom that Power is vested.
Yes. Barr was well known as a controversial politician even in those times. You can find numerous news reports affirming this. His entire political career is one giant walking controversy. While I agree that his words and opinions were more mainstream at the time, he was at the storm of more than a few scandals. Iran contra pardons are another obvious one.
> "{Are his actions} politically motivated? {Or} self-serving? I'm asking myself those same questions," said one key Justice Department official
> Much of what Barr has done since his confirmation seems to benefit the administration politically. He pleased conservatives by reversing policy and offering Justice Department help to states that want to get out from under court-ordered prison population caps.
> if Goog wasn't a majority "blue" company would he aggressively go after them
Certainly can't help them. However, I think that's a moot point if everyone can agree they are the most troublesome company in the "land of large companies". It seems like every few months I see outrage on HN over "Google increased pricing for $X service, but there aren't really any other options" situations.
Cable companies have taken billion in federal subsidies, lied about universal deployment and speeds, and unless there is local competition have taken customers to the cleaners, forced the purchase of bundled channel packages, charged rentals for modems they were not renting (I should know - I called in every month to have charge removed) etc.
I can think of a long list of other large / monopoly type companies that regular abuse consumers at far higher levels than google does.
Consumer spend on google is actually pretty small.
You spend a lot of time in an echo chamber that specifically like to talk about niche topics and specifically likes to complain about Google. Do you remember the “Google Cloud is getting shut down” hysteria? HN is a bubble.
I agree with Comcast, they need to be broken up, and Amazon could do with some scrutiny. But Apple, Boeing and United Airlines? The aren't monopolies by any definition.
Breaking up a regional monopoly into smaller regional monopolies doesn't work (see baby Bells).
What would be better is requiring the owners of any last mile infrastructure to lease said infrastructure to any other interested operator at cost. This worked with DSL, but the mandate ended when we moved on to other technologies like cable and fiber that had no such requirements.
Instead, we now do the opposite. We give ISPs tax breaks and incentives and piles of cash to "build out the infrastructure" (read: we pay them to invest in their own business), because they threaten to not build it otherwise (read: they're threatening to deliberately decline to grow their business), and for the privilege of paying them to increase their customer and revenue base, we (get this) give them the exclusive right to be the only operator of any similar last mile infrastructure in that area.
How fucking stupid can we get?
We should not allow these agreements to happen, and we should retroactively void any that are currently in place.
I’ll believe it when I see it. Nothing wireless comes close to The experience of a wired fiber connection, especially getting through walls of various materials.
Apple's monopoly is unusual, because what they did was create a wall around a section of an ancillary market (apps) which caused it to be its own market. Walmart doesn't have a monopoly on bread because anybody can buy bread from Costco instead without having to buy a new toaster. Once you make buying $1 apps from not-Apple require people to replace their $1000 phone, that makes apps for that kind of phone its own market which Apple has a monopoly on. That wouldn't be the case if they had competing app stores, but they don't.
Boeing has a serious lack of competition. Their only meaningful competitor is Airbus and that's a foreign company. They have no domestic competition at all, which is inherently problematic, especially for a critical industry like that.
I don't understand why United Airlines is on that list either. Airlines are a weird market because it's extremely capital intensive but also aggressively competitive, so they sort of alternate between all going bankrupt from relentless price competition and all colluding to raise prices enough that they don't all go bankrupt and then getting in trouble over it.
> Boeing has a serious lack of competition. Their only meaningful competitor is Airbus and that's a foreign company. They have no domestic competition at all, which is inherently problematic, especially for a critical industry like that.
This isn't due to monopolistic behavior; the McDonnell Douglas company, the last big American competitor to Boeing, would probably have ceased to be a going concern had the merger not happened. Modern aircraft cost billions and billions of dollars to develop; Bombardier just threw in the towel and sold to Airbus, and Embraer almost did the same with Boeing were it not for COVID. There are only so many aircraft manufacturers with the resources to invest in development of brand new commerical aircraft.
That might mean they haven't violated antitrust laws but that doesn't make them any less a monopoly. We might also want to start looking at how that somehow happened without them doing something untoward, because it implies that something else has gone wrong -- why is it now prohibitively expensive to design a commercial aircraft when it didn't used to be?
Monopolies also aren't allowed to do certain things no matter how they got that way. (Many of the things Apple does come to mind.)
1. Aircraft is not a monopoly, it's a duopoly between Boeing and Airbus in certain aircraft segments, and there are other manufacturers like Embraer. Airbus has manufacturing lines in the US and sells plenty of aircraft to American customers so it's not even a monopoly on manufacturing in the US.
2. Aircraft development has always been really expensive. Lots of iconic companies have shuttered, merged, or otherwise ceased to exist because aircraft development is fucking hard. Historically:
* McDonnell Douglas merged into Boeing (or the other way around, depending on your view) after they failed to build the MD-11 up to the performance advertised to customers and suffered billions in costs and delays, and that was formed from an earlier merger of McDonnell and Douglas after Douglas struggled with the costs of developing the DC-8 and 9, both airliners that are considered to have sold fairly well.
* Airbus was formed from scavenging various European national aircraft manufacturers because they would all lose money if they tried competing individually vs MCD and Boeing.
* Lockheed Martin exited the commercial aircraft market decades ago after spending billions of dollars on a delayed aircraft that airlines said they were interested in, but then got cold feet about buying.
More recently:
* Bombardier sold its aircraft lines to Airbus because it spent billions of dollars trying to fix mistakes and delays.
* Embraer tried to sell stakes in its aircraft lines to Boeing because despite having airplanes that sell well they could not cope with the cost of developing updated versions of their aircraft.
* China, Japan, and Russia have each had state-backed programs to try and take some of the lucrative airline market. All of the programs have cost billions of dollars, were delayed, and on top of that non-domestic customers are not really interested in these planes since they have worse efficiency and performance characteristics than competing aircraft products.
Even the big two have had problems; every single recent aircraft line has seen delays and cost overruns. Boeing and Airbus are just big enough that they can eat the cost of it without needing lots of government subsidy, but the MAX8 crisis has shown that might not even be true anymore.
If it were possible to reduce costs, someone would have done it by now, because aircraft manufacturing can be a very lucrative industry resulting in millions of direct and indirect jobs. As it turns out, aircraft are expensive because the ever-increasing requirements for fuel efficiency and safety from airlines and regulators have resulted in aircraft that get harder and harder to develop and build each generation. Rolling any of this back is not a good idea, because
* for various reasons, using more fuel than you have to for air travel is not good
* every single safety regulation for aircraft is written in blood, and in general people do not want to fly in planes created via "move fast, break things"; see the MAX8 crisis.
> Monopolies also aren't allowed to do certain things no matter how they got that way. (Many of the things Apple does come to mind.)
What is something Boeing has done that they should not be allowed to do as a result of their position in a duopoly?
The Apple iPhone has very close to 50% market in the US and you simply cannot have a successful mobile software business without releasing your app on the iPhone.
Democracy is about setting the rules for society, including how to reallocate some fraction of private resources according to a popular mandate.
This doesn't mean its corruption. You need more qualification to call it that.
(Not saying that the Trump admin isn't corrupt. I'm rather saying that your statement is too broad, and it fits almost all generally accepted democratic governance.)
It’s possible to be corrupt with a democratic mandate. Levying taxes is one thing, sending the justice department after companies because they are out of favor with the current administration is obviously another.
Precedent is tricky. Democrats removing the filibuster for judges came back to haunt them.
There was a recent (last few weeks) SCOTUS decision that came out with numerous opinions by different coalitions. You could tell that they were all maneuvering around this idea of precedent.
Liberal justices who ended up on either side (majority or minority) were couching their votes as upholding a prior precedent, even when they definitely weren't.
Conservative justices ended up on either side of the case while subtly arguing that overturning precedent, or at least modifying it, was okay and normal.
Both are presumed to be setting up for the next challenge to Roe vs. Wade.
EDIT: mistakenly put that the democrats removed filibuster for SCOTUS judges, that was for other nominations
Democrats didn't remove the SCOTUS filibuster, the Republicans did that to get Gorsuch on the bench. The Democrats removed the filibuster for regular judicial appointments during Obama's tenure because Republicans blocked all of his nominations, using the judicial filibuster more in two years than all previous Congresses combined.
I don't buy that. The Republicans would have killed the filibuster when they were next in power. This was simple acknowledgement by Democrats of the changing nature of the Republican party.
"We struck first because the other side was going to strike first if we didn't!"
Who knew that first-mover advantage existed in politics? Or perhaps this is better seen as a example of mutually assured destruction playing out in real life?
Yes. The filibuster is allowed to exist because of a mutual consensus to reserve it for contentious issues, and not to simply filibuster 100% of the time. Republicans broke the disarmament agreement by filibustering (essentially) the entire appointment process, so the Democrats re-armed. It just goes to show how important norms and not breaking them are to the functioning of society. If you insist on living by the letter of the law in contravention of the spirit, expect the law to change.
Precedent is tricky. Democrats removing the filibuster for SCOTUS judges came back to haunt them.
Did it though? Legal precedent is different (for now) from political precedent, and I think the Republicans have proven they’re happy to steamroll through almost anything they can to seat a Justice. They would have instantly dropped the filibuster if it hadn’t already been done.
This is no excuse to be the aggressor. "Republicans might do this" allows you to steamroll over anything set up to force compromise and bipartisanship. Once they're already doing something you don't have to feel bad about doing the same thing when it's your turn, but whoever is the first to tear down a barrier to naked partisanship is the party doing wrong.
At least with respect to judges, it's not so much "Republicans might do this" as "Republicans are already doing this". Don't want to get too deep into the weeds here, but take a look at https://www.youtube.com/watch?v=gXl5A9EdLtU&t=2015
Democrats didn't remove the filibuster for SCOTUS judges, Republicans did that (McConnell). Democrats (Reid) removed the filibuster from federal judges, because Republicans were refusing to seat Obama nominees, and over 100 vacancies had piled up.
The courts, and in particular the supreme court, have increasingly been weaponized as ways to both advance agendas and preserve inviolable causes of both parties. Since the justices are appointed by political processes, that appointment has also become increasingly political, to the point that people justify voting for a presidential candidate they dislike because of the supreme court vacancies the candidate will presumably be able to fill.
The libertarian answer would be to reduce the power and discretion of government officials so it won't be such a high-stakes, partisan process.
It’s more like “how strictly do these judges interpret and apply the Constitution.” The more creative interpretations are what have allowed for progressive, or liberal rulings.
Market concentration for all of those companies is much less than for Google. Google has 91% of the search market. Boeing has 45% of the global airline market. Amazon has a similar percentage of the e-commerce market, and an even smaller percentage of the retail market. Apple had 39% of the domestic airline market. United has 15% of the domestic airline market. Comcast’s market penetration is under 50%. (That means they have less than half the market in the areas they serve.)
I don’t know if there is a political angle to this or not. But Google is objectively differently situated than the other companies you mention.
Matt Cutts Google's infamous SEO boss, you know he was only doing his job and trying to rank literally millions of websites on the internet. Ranking algorithms are black box btw no way somebody will completely understand them any time soon.
Google ought to scare you a lot more than the other companies you listed. One not need bring politics into the picture to understand why surveillance capitalism-based companies may require distinct scrutiny.
I mean, your choices for flying somewhere are what - Delta or United? Some small regional carriers? What about for internet service - just a single ISP in most areas. Sometimes a monopoly by law, where no one else can lay fiber and they're free to charge as much as they want.
Your choices for searching something on the internet, hosting a video, doing email, etc. are innumerable.
So you'll have to qualify what you mean by "negative impact" before I can answer that.
I don't think transportation is a good analogue because it is very easy to make substitutions. There are lots of ways to get from point A to point B with no single entity blocking your path.
How many ways are there to publish a mobile app, for example?
I generally describe myself as libertarian but I'm struggling to have a laissez-faire attitude about some aspects of big tech. I think the most frustrating thing is the lack of "due process" in the way that big tech deals with customers. Look at the recent story about the ridiculous review process for Chrome extensions. I could tell similar stories about the app stores.
> I’ve never had my searches for coronavirus related content restricted in any way by my ISP for example.
Your ISP isn't a search engine. It's also regulated more like a utility, unlike Google. If your ISP started black-holing IP addresses for reason of the content they carried, there would be Congressional action (if the FCC didn't get there first).
Because of network effects that turns out to be a lot weaker protection against much more powerful companies.
Edit: Perhaps network effect is the wrong term - but it’s a bit like saying if you don’t like guns don’t buy a gun - that doesn’t really limit the negative impacts from guns...
The capital costs might actually be similar (or higher for AWS). The margins, of course, are much lower for an airline.
The best data point I can find is that Google spent 13B on datacenter and office construction in 2019, which is about the same as the purchase cost of all 130 of Delta Airlines' 737-900ER aircraft (which is about 1/6 of Delta's entire fleet).
> The best data point I can find is that Google spent 13B on datacenter and office construction in 2019
It’s hard to do a fair comparison like this between high growth companies and normal companies - for example what fraction of that cost for Google is growth based vs to maintain exisiting services?
Boeing's 737 Max debacle killed two plane-fuls of people. It's pretty hard to argue that either Amazon or Google has had negative effects on that magnitude.
I don't think it's particularly useful to compare across industries like this, especially when invoking an "appeal to worse problems" to justify ignoring a problem under discussion.
> > > Are any of those companies (except Amazon) even in the same league in terms of negative impact as big tech?
> > Boeing's 737 Max debacle killed two plane-fuls of people. It's pretty hard to argue that either Amazon or Google has had negative effects on that magnitude.
> I don't think it's particularly useful to compare across industries like this, especially when invoking an "appeal to worse problems" to justify ignoring a problem under discussion.
Interesting sequence of comments. Perhaps you placed yours at the wrong level but it certainly doesn't look like good faith at the moment.
No, it's not; it's just tedious and requires math and statistical/actuarial concepts like quality-adjusted-life-years. (The TL;DR would be that google inflicts significantly less harm per person to vastly larger numbers of persons.)
Unpleasant and time consuming is not the same as difficult.
I don't have an example at hand directly involving Google or Amazon (though these may well exist), but if you'll accept a case in which another cavalier tech monopoly has directly contributed to massive loss of life, there is the case of the ongoing Myanmar genocide:
In August 2018, a study[86] estimated that more than 24,000+ Rohingya people were killed by the Myanmar military and the local Buddhists since the "clearance operations" started on 25 August 2017. The study[86] also estimated that more than 18,000 Rohingya Muslim women and girls were raped, 116,000 Rohingya were beaten, 36,000 Rohingya were thrown into fire,[86][87][88][89][90][91] burned down and destroyed 354 Rohingya villages in Rakhine state,[92] looted many Rohingya houses,[93] committed widespread gang rapes and other forms of sexual violence against the Rohingya Muslim women and girls.[94][95][96] The military drive also displaced a large number of Rohingya people and made them refugees. According to the United Nations reports, as of January 2018, nearly 690,000 Rohingya people had fled or had been driven out of Rakhine state who then took shelter in the neighboring Bangladesh as refugees.[97] In December, two Reuters journalists who had been covering the Inn Din massacre event were arrested and imprisoned.[97]
is Facebook really doing all it can to try to halt the spread of violence? Not according to the United Nations’ Fact-Finding Mission on Myanmar, which released its own report on Tuesday looking into the causes of the genocide that has taken place against the Rohingya in that country. Among other recommendations, the UN report says any commercial entity doing business in Myanmar should not “enter into an economic or financial relationship with the security forces,” including the military police, known as the Tatmadaw.
With no absolution at all to Beoing for its impressive death count, 24,000 souls, and tens of thousands of rapes and beatings,, in which Facebook's negligence played sufficient role for the UN to specifically call it out, is more than a couple of planes-full, and is why what happens online is in fact as serious and consequential as can be.
This antitrust case is the most straightforward one for prosecutors to win. It's been a long time coming and the FTC would have brought one during the Obama administration if they weren't so captured by the tech industry and Google in particular [1][2]. I expect Google will lose their antitrust cases globally. Cases against other tech companies like Facebook and Amazon seem less certain, but I haven't really thought about antitrust theories too deeply for them.
Isn't settlement far more likely than losing all the way through appeals? And in what way is it straightforward? Does it not require a new interpretation of antitrust law? Google isn't using monopoly power to increase prices for consumers.
>Google isn't using monopoly power to increase prices for consumers.
This is whole reason for the criminal trial. If they can prove Google stifled competition in the advertising business, it is going to be a cut and dry case.
Amazon and Facebook should be next. Break them all up with extreme prejudice and put strict new anti-trust laws around acquisitions in place for the future.
We're going to do this and open technology back up to innovation and progress, or just watch the tech giants continue to grow in power and abusiveness year after year while new startups continue to decline.
Ah yes, tech is the industry with the most insidious monopolies, not oil, telecom, or defense. And surely, the current government will enthusiastically move forward with the actual /legwork/ (rather than saber rattling) of killing its goose that lays the golden egg.
Let's be real here. None of these megacorps are getting broken up any time soon. We haven't had a trustbuster in office for a very long time. The megacorp/lobbyist/politico triopoly has ruthlessly, slickly snuffed out any perceived opposition for quite a long time.
I’m not sure that’s inherently disqualifying. When it comes to questions of law and justice, it seems entirely reasonable to ask about similar cases, simply to investigate the equal and fair application of law, no?
“Whatsboutism”, as I understand it, is a technique where one brings up ill-proven allegations that are unrelated to the matter at hand merely to distract.
Here, the claim seems much more on point: it’s that this is a political case, as shown by the failure to pursue similar cases against other companies.
(Is it? I don’t personally know. But it seems like a fair point to make.)
Law especially at the federal DOJ level is as much about which cases to pursue as it is about what cases have merit. Either no monopolists should be prosecuted or a select subset worthy of the opportunity cost should be. How big the subset is a question, and the proper subset could be zero, but it's not a contradiction to see selective enforcement of anti-trust. The opposite, where many big, massive cases are opened on many fronts simultaneously is almost never the methodology of federal law enforcement afaict.
Sure, but the claim here wasn't (as I read it) that this is unusual, but that it's unjust.
If prosecutors are selecting the highest ROI targets based on some calculation of which cases they can win and which cases have the biggest consumer or market impact (or are most egregious), that doesn't seem especially problematic. If they're selecting targets for prosecution based on who has political connections and who does not, however, that's very different.
Taken to the extreme, it's "whataboutism" to ask about racial disparities in criminal prosecutions; if a defendant is guilty, who cares if some other accused perpetrator of a different race wasn't prosecuted for a similar offense?
The impartial application of law--at least with respect to considerations like race or political connectedness--can certainly conflict with the pragmatic considerations of prosecutorial strategy, and I don't think it's simply "whataboutism" to question that tension.
Well, the burden of proof seems to be on the person making claims going after big tech vs other industries is politically motivated. I would prefer the DoJ step in to take actions against companies that are abusing their power to massively violate the world's privacy through surveillance systems which have unimaginable capabilities for shaping global human behavior. It's hard to think of a more worthy target of anti-trust law than the companies which are poised to control the minds and behavior of billions due to their market power.
Agreed. But I read the parent’s comment as being about the legitimacy of such a claim itself—that the claim of political bias is not merely lacking proof but “whataboutism” and thus illegitimate or irrelevant, even if proven. :)
Of course one might view these cases as legitimate, and bemoan that similar prosecutions don’t happen against companies in other industries, as well. The effect of political bias may be to suppress cases that should be brought, not to bring cases that shouldn’t be.
no, it isn't. The parent comment isn't saying "but what about those other things we should break up just because?". It is saying "you make it sound like breaking up big tech will accomplish a lot, even though, I think, breaking up those other things is a way higher priority that will accomplish much more, and here is why".
100%. When I look at the level of regulatory capture from pharma (which I neglected to mention, sorry!), oil, defense and telecom, as well as the slickness that they engage with optics through PR, all I can say is that the way forward is anything but easy.
> Whataboutism, also known as whataboutery, is a variant of the tu quoque logical fallacy that attempts to discredit an opponent's position by charging them with hypocrisy without directly refuting or disproving their argument.
Oh?
You see, I was not charging the OP with hypocrisy. To the contrary -- I think that the desire makes sense and would be nice to see happen. But I just wonder about how the messy details of that would work. I mean, we have certainly failed to break up other industries because they compromised the antitrust apparatus through regulatory capture. To not engage with the elephant in the room of regulatory capture (when talking about antitrust) is to not talk about antitrust at all.
Ever wonder why innovation takes place? Wonder why we are not still reliant on locomotives for transportation?
Economic incentives for innovation and disruption are greater when a monopolistic entity is over charging for it's good or service. If they are not over charging then there is not as great an incentive to innovate or disrupt. If the latter is the case, why bust a monopoly that is providing a fair service?
> Economic incentives for innovation and disruption are greater when a monopolistic entity is over charging for it's good or service.
Care to back that up, or are we supposed to take your, frankly, very unorthodox views at face value? Every industry I can think of with entrenched monopolies sees almost no innovation until things get so bad that they are finally disrupted: aerospace, energy, advertisement, telecommunications, and the list goes on and on.
Amazon doesn’t really “have” a monopoly. Walmart just can’t compete online, but it’s because they suck, not because of a structural force stopping them.
> Every industry I can think of with entrenched monopolies sees almost no innovation until things get so bad that they are finally disrupted: aerospace, energy, advertisement, telecommunications, and the list goes on and on.
Check out the historical market shares in the links. Markets have changed in time with respect to computing. People are opting for mobile devices which use arm processors(even breaking into server space). Unless the behemoths in the industry adapt, their industry may not exist in the future. That is innovation and disruption happening right now.
Intel had in 2018 90.4% of the desktop/notebook/server market with 96.8% of the server market share. Maybe this is only Intel vs. AMD stats. Are servers run with other processors?
Standard oil(Arguably the most notorious monopolistic company in the history of the United States) by comparison: "At one point, it was believe that they controlled somewhere between 88% to 91% of all the oil in the United States"
Maybe I'm lost here but why is this a good thing? and what this is providing for the consumer. I am not harmed by Google price fixing (as far as I know) because I pay them exactly $0, nor do I want to see the days of the 90's again, when you needed a 'metacrawler' to search a bunch of search engines. Now if we were talking about my ISP, for which I have exactly 2 choices and both of them collude to increase my bill, then we'd be talking.
"Facebook could be forced to get rid of Instagram and WhatsApp, Amazon might divest Zappos and Whole Foods, Google may lose YouTube, and Apple could part with its App Store."
If you were going to bother, you'd split Amazon and AWS. Amazon becomes mostly a retail company again. Without the AWS subsidy margins, they'll be down to retail margins and the ad business (with ads, it's plenty). They can perhaps keep the gadgets, splitting every major aspect apart might be going too far.
AWS is a $400 to $600 billion market cap company right now if it were trading on its own, based on its operating income and the insatiatable market demand for anything cloud. The ticker is even available conveniently. They'll get to $150+ billion in sales and $25+ billion in operating profit in the next six to seven years (average of 21% annual growth over seven years; very much within reach). It might approach being a trillion dollar company a decade from now (at MSFT type multiples).
You'd split Facebook and Instagram as the most obvious separation line (and then do something with WhatsApp, it can be spun off or go with either or; FB already has messenger, so it probably shouldn't go with that entity).
Instagram is a $100+ billion publicly traded company on its own plausibly. There is some question on erosion in both FB and Instagram once you detach them from eachother. They both lose a huge protective moat and cross promotion (Instagram has become a lot more mature at this point, it'll be more at risk to userbase erosion going forward, versus say five years ago; and FB is definitely at high risk for userbase erosion with fewer moats).
They could also spin off Amazon's patent portfolio into its own company that would license the patents back to Amazon and anyone else who wants to compete in the ecommerce market.
AWS, Amazon Studios, Amazon the online marketplace, Amazon the producer of goods sold on that marketplace, Whole Foods, Ring, Twitch, whatever else they own
Amazon Studios would be the same business model as any other independent TV/film production company.
Amazon marketplace operates on very slim margins to stay competitive, but it's hard to believe it couldn't be profitable on its own. Maybe it would have to settle for slightly less universal domination.
Many businesses make money by exclusively selling through Amazon, so there's no reason they couldn't spin off a profitable business that sells Amazon Basics and whatever other store brands they produce.
Whole Foods is obviously a viable business.
I doubt Ring was profitable but it was clearly capable of getting VC money on its own. If it can't be a viable business, why did they start it? And why did VCs invest in it?
FYI, there is a project for that [0] of which Apple, Facebook, Google, Microsoft and Twitter are a part of. It's not forced and is still in development but it's something.
Consider that Facebook has 3 different messaging apps, and Google has an unknown number of messaging apps. Both companies have strong internal incentives to consolidate their own messaging apps and yet these efforts have never succeeded. I'm not sure if having a single universal protocol is the best idea.
I believe the idea is that, if those companies can't do it, even though they want to, then it may be hard to do (or at least to do well/cleanly). Requiring it to be done may therefore be a bad idea.
Well conceivably you could separate out the Facebook ad network and the Facebook social media, and possibly also maybe the IM systems (FB Chat/Whatsapp).
I know virtually nothing about antitrust law, and I'm not a lawyer, so I'm speaking largely out of my behind, but those seem like logical-enough divisions.
What will breaking up Google accomplish? I think the individual orgs inside Google already act as separate businesses. So they are already split internally.
In my opinion, Microsoft became a much better company after their brush with antitrust. I don’t know how much had to do with the case and how much is just because of the quality leadership they have now, but I hope Google becomes a much better company in the future. They went from having great products to downright creepy and it’s difficult not to use any of their products or to be tracked by them. I’d like to see a different Google.
If you split all datacenter operations into separate company (Alphabet Cloud), Search and Ads will not receive access to cheap resources on significant discount, but will pay fair market price, which is a big burden for other companies trying to enter the market.
The amount of data that Google has on you is immeasurable. The fact that there is no firewall between Google business entities in terms of data sharing is absolutely insane.
They have normalized the concept of sharing your data to the internet and monetizing it. At least Facebook and Amazon are accountable for their actions.
Do DOJ rules only apply to Google's operations in the US?
Could DOJ also do this to overseas-based companies that operates in the U.S.?
Say you break up Google, Facebook, Amazon, etc., and people begin to adopt the platforms like say, Baidu, TikTok, Alibaba, etc. which grow to 90%+ market dominance. Can DOJ bring antitrust lawsuits against Alibaba?
The big one is Amazon. The revenue from AWS funds the ability for them to crush the high street on the shopping side. They should be forced to sell off AWS as a separate company.
Having a competitive advantage is not illegal. Someone correct me, but isn't the law's intent to protect people from abuse of monopolistic power? Which wouldn't be the case here.
The laws intent is debated. Some think it is there to protect consumers. Others to protect free enterprise and eliminate the ability to manipulate a marketplace - pro consumer or not.
Lately, the outlook of protecting consumers has won out in the US, as that is what the Supremes laid out as a determining factor in the later half of the 20th century.
But it wasn't always that way. And the laws aren't written that way.
In my opinion, focusing on consumer benefit is a red herring. We are all both consumers and producers. An economy full of companies shutting out competition through market manipulation may be good when I'm trying to buy something, but it's bad when I'm trying to find work, because they can dictate whatever terms they desire in that half of my participation in the economy.
While it's probably true that most of the tech companies have some form of platform monopolies, William Barr, out of all people, is not to be trusted. Hatchet man through and through.
The motives here are entirely political. Notice that the ISPs, telecom industry in general, defense industries are left out of this discussion.
Tech companies lean left, largely donate to the Democrats, and have been the focus of conservative groups for years as they are considered "biased" towards those on the Left. Like many things about Trump's administration, it's about revenge against those who oppose him, be they companies, state or individuals.
I think to myself how I would probably be just fine if the Google search engine became a public service tomorrow and all advertisements were removed, or perhaps only a small area of the page were allowed to be used to make enough money to pay the costs of upkeep.
I'm reminded of how I was so enamored by the internet during the age of the directory. Humans assembled information to share with each other, and there were different search engines you could use as well. It was just so much more interesting at the time.
There are still wonderful examples of information being assembled by humans like Wikipedia. But these types of sites struggle to have enough money to operate, while other companies just dominate everything, especially anything that involves money. That's how the market works.
But there are certain things the way having libraries, police, firefighters, maybe you can health insurance, where if profit is the only thing that's going to be considered, it just creates a society that is less worthwhile. Perhaps the search engine needs to be considered a public service.
Right. Just like how publicly funded broadcasters have never promoted any kind of propaganda, a publicly funded search engine will be politically neutral in every way. Who funds this public service? The US? Everyone? Well I don't live in the US, why should I have to fund your public service? What if I don't want to use Google, but DuckDuckGo instead?
(You see, the arguments go on and on...)
Private sector companies done right (aka incentives align correctly) are inherently more trustworthy than public sector.
Disclosure: I do work for Google, but I've held these opinions for a long time.
Google has achieved its market position through providing a service its customers want to use. They have not restricted any competitor. Anyone can easily use another search engine, and Google does nothing to stop them.
The US government’s increasing hostility towards peaceful trade is alarming. Google is one of America’s greatest business successes of this century.
Regardless of any one's opinion about this being right or wrong, good or bad, Google has spent enormous resources preparing for this moment. From lobbying efforts to the Alphabet restructuring, Google has been acutely aware of this possibility years ago.
I think this was a long time coming. However, I don't trust the current administration's motives for doing it. My instinct is that this is just some behind-the-scenes string pulling to eliminate an entity that is seen more as a political threat than an economic one.
Looking at that picture, it's amazing how much more put-together Sundar Pichai is than Bill Gates. Some of that might be their individual personalities, some might be that the tech industry has grown up a bit.
one thing I always have a hard time understanding. What if a tech giant is considered a Monopoly but it makes my - as a consumer - life easier? I mean having flights tool readily available near Google Search which helps me quickly find a cheap flight without upselling me with hotels and car rentals etc on aggregators like Expedia is something I love and makes my experience better.
I think it‘s kind of funny that there was an article today about Google‘s Pixel division being disjointed and not integrated enough with the Android division.
Maybe part of the reason for the publics perception of Google‘s teams and divisions seemingly operating in an independent and chaotic manner is a way of minimizing the attack surface for antitrust accusations.
Integration is hard. The amount of work to keep good integration between all services in a business grows as the square of the number of services. Missing “obvious” integrations is just a natural consequence of being large.
> The amount of work to keep good integration between all services in a business grows as the square of the number of services
That's true if each of the services directly integrates with each of the other services—or, more generally, if the number of integrations per service grows proportionally to the total number of services.
But the number of service interactions per service seems, IME, to increase sublinearly with number of services, and a decreasing marginal rate.
Even the effort of being on the lookout for whether two services should naturally integrate with each other scales superlinearly. Eventually you reach a point where most teams don't even know of the existence of most teams.
I think some antitrust enforcement in tech is overdue. But it needs to be applied broadly and fairly across the entire industry. Singling out single companies is just picking winners and losers.
Making big acquisitions much more difficult and reviewing the big acquistitions of the last decade would be the right place to start in my opinion.
Thankfully USA has provisions codified in law for this kind of thing. It was famously enforced against Microsoft. Now enforce it against Google. And then do it against Facebook.
If we believe for a moment, this is a play against Google's liberal position, or at the very least Google's employees liberal outlook.. (I will try to pull up references).
Lets say it's true: These actions are by all accounts the same as the old communist states.. Only this time they're under the guise of legal proceedings which have some precedent. Americans would usually be so alergic to the idea of such a thought that there would be uproar.. But nationalism and faith in a leader/idea has prevailed.
I would argue that it's super rich for the Justice Dept to be worried about antitrust all of a sudden, as a European, I've been fortunate to be protected far better than the US over the years by why of data protection laws. Also knowing Google and other major tech companies penchant for moving their headquarters abroad (Ireland for example), its super interesting to see a swift interest in antitrust..
The US has had, and still does I believe, a huge fight to get chip & pin on debit and credit cards because of insurance liability.. But hey.. Those tech companies.. Gotta get them first.
I'm no tinfoil hat wearer, but if it walks like a duck .
Tech is an area where the contradictions inherent in the liberal approach to regulating companies are most clear. Liberal theories of nice capitalism require multiple competing companies on "fair" grounds. But it is obviously annoying and inefficient to have market competition in software most of the time - once a tool is developed, it's nearly free for 100% of people to use it rather than 50%, and it's crucial that all such tools interoperate nicely. Hence why various walled-off social media platforms are annoying and people are squeezed into at most only a couple for a given purpose. When right wingers point out that anti-trust stuff is inefficient, to an extent they're right.
The rational thing is to have a "monopoly" that isn't evil. But that means that democratic control shouldn't be after-the-fact, external regulation (shown time and time again to be insufficient and generally bought off) but fundamental to the operating of these companies. In essence, Google makes the case for democratic management of production - socialism - very clear.
But the other important part of this theory is it's not just about "what would be nice to have" in some utopian sense. Larger companies have competitive advantages that cause them to grow even faster - some real economies of scale, more political heft, greater bargaining power. This leads to the system being inherently unstable and tending towards concentration, which is apparent in pretty much every sector of tech. Trying to permanently reverse this trend through anti-trust is as nonsensical as suggesting people go back to living in the woods; it is in opposition to the fundamental trends inherent in market economies. The only way we can move is forward, to the resolution of these contradictions by working class ownership of all by all.
To try to preempt one counterargument: such a system doesn't mean we can no longer have "competing" software projects that do similar things if it is beneficial to compare different approaches. We can easily do that if it's better overall. But in such a case, each approach to a given software problem would be fully open, and developed in coordination with the others and with an understanding of their successes and pitfalls, to maximize productivity. This wouldn't be siloed-off, hostile competition but a scientific, coordinated approach.
They'd me much better off having them open source YouTube and/or Gmail. I don't really think Google as a whole is an evil corporation, and there are a lot worse companies out there with a clear monopoly.
I can't help but think that fighting big tech with anti trust approaches is like fighting the T-1000 with a katana. You can win a few fights, but it just reassembles itself because they will outsmart the challenge adapt to the new situation.
If you want real change then you got to be more radical than just separating Google search from Gmail or Instagram from Facebook.
I have no idea how, but the goal should be to change their incentives.
It’s funny how Microsoft has learned that anti-trust has nothing to do with competition and is 100% politics and public perception. Just sell to other businesses and you can do whatever you want.
Google is regularly accused of leaning left and has taken open steps to curate search results and other content in an ostensibly unbiased manner, but one which may disproportionately censor right leaning sources.
This is motive for a right leaning government lead by an infamous narcissist to attempt to rein in Google's power over information.
It's dangerous for us all to be so dependent on a few companies. I doubt that's what motivates the DoJ in this case, but right now, if you have a problem with Google, you have to post a cri de coeur on Twitter or Hacker News and hope it embarrasses somebody at Google enough to take action on your behalf.
More competitors in the advertising and search space would certainly help, or at least keep the situation from getting worse.
As for Amazon, the antitrust enforcers should have come down on them like a ton of bricks the moment it appeared that they were leveraging internal business intelligence to compete with their own sellers. I use Amazon constantly, I have an enormous amount of respect for them, and I value their services a great deal, but come on. There's no point in even having antitrust laws if they don't apply in this instance.
Re: Amazon, many companies do the same thing (e.g. CVS, Target, Costco). With Costco in particular, Kirkland products are higher quality and cheaper than the competition in almost all categories they are in, which is a benefit to me as a consumer. Should Kirkland be broken off just because other companies can't compete with it? If not, what's the justification for Amazon?
I don't see why not, but admittedly I haven't thought it through any further than that.
The comparison with store brands doesn't really work because Costco and Sam's and Target don't invite third-party sellers to build their businesses on what amounts to sharecropped shelf space. Procter & Gamble and Berkshire Hathaway can hold their own in any negotiations with Costco and Amazon. For small businesses, the situation is more like the complaints we always hear about Apple's app store, where the company buys or builds their own first-party competitors in categories that prove unexpectedly successful.
Dirty pool, but legal enough... at least as long as you (a) don't hold a monopoly on distribution, or aspire to do so; and (b) didn't just get back from Washington, DC where you told Congress that you didn't do this. Both of these factors are problematic with Amazon, IMO. It's true that they don't hold a monopoly on distribution, technically speaking, but where else are third-party sellers supposed to turn?
The total ownership of virtually all the data for a huge percentage of the population could be argued to be a high price, depending on your perspective.
Google has many competitors in the data gathering business. If you combine the few big tech companies data gathering it is a significant portion thereof, but the fact that you have to combine them means any one is not a monopoly by itself.
