The Monopolies That Dominate the Internet 342
Tim Wu has a piece up at the Wall Street Journal pointing out that the free-market, open Internet — "competition in its purest form" — has evolved to be dominated by monopolies. Wu argues that this is nothing new, and that each wave of information technology in the US has followed a similar pattern. "Today's Internet borders will probably change eventually, especially as new markets appear. But it's hard to avoid the conclusion that we are living in an age of large information monopolies. Could it be that the free market on the Internet actually tends toward monopolies? Could it even be that demand, of all things, is actually winnowing the online free market — that Americans, so diverse and individualistic, actually love these monopolies? ... Info-monopolies tend to be good-to-great in the short term and bad-to-terrible in the long term."
Its not 'internet'. its 'free market'. (Score:5, Insightful)
http://slashdot.org/comments.pl?sid=1847700&cid=34083272 [slashdot.org]
Nope. It's the credit supply (Score:2, Insightful)
It's a feature of the supply of credit to the market. You make money by pushing your competitors out of the market and taking their business. Credit is what allows you to do that.
In addition, the fact that you have loans to pay means you are largely required by your creditors to grow.
Re:Nope. It's the credit supply (Score:5, Informative)
read the post i linked down in the grandparent.
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Exactly. The reason is simple, money attracts money. It always has and always will. In the absence of a re-distribution framework, those that have lots will always be able to siphon more off from those who have little.
Put another way, an unregulated free market is intrinsically unstable. There exist a number of local minima where competition exists, but eventually it all falls into the deep well of a monopoly. This should surprise nobody, Adam Smith pointed out the need for regulation to avoid exactly that
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Adam Smith pointed out the need for regulation to avoid exactly that fate.
can you provide a link to a source. it would be great to clear out some misconceptions in future discussions.
tho, regulation can never be enough. any group will grow as large as the society allows them. if you allow them to be as large as a country (like the 6-9 companies that dominate the world's biggest economic entities list in top 13), they will eventually become as powerful as countries.
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Start with The Wealth of Nations [gutenberg.org]. Keep in mind while reading that he was writing about a very different world. Consider his examples and how they are changed in a world where corporations far more common (in his day it was possible for an individual to never do business with a corporation without even trying).
Then search on Adam Smith market regulation. Have a pound of salt handy, you'll find everything from insightful analysis to the worst sort of economic fundamentalism.
IMHO, we need to replace the web of
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Adam Smith pointed out the need for regulation to avoid exactly that fate.
can you provide a link to a source. it would be great to clear out some misconceptions in future discussions.
Nah; it wouldn't clear up anything. I've read the Adam Smith comments on the topic in other /. discussions and in numerous other forums. It never has any effect. The True Believers never accept that Smith wrote such things, and others Who Knew It All Along just skim over them and go onto more interesting things. Quoting him once again won't have any more effect than it did elsewhere.
Let's face it, very few of the Free Market types have ever bothered to read Adam Smith. It's a lot like the way that most
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Actually an "unregulated free market" is an oxymoron, the "market" is not a physical thing it's a set of regulations that govern trade. Therefore an "unregulated market" doesn't make sense since it translates to a set of rules with no rules. "Free" simply means everyone is free to partcipate provided they play by the rules.
Contract law, property rights, legal tender, etc, are all part of the regulations that go into making the internet a "market",
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Let's look at your post:
You make money by pushing your competitors out of the market and taking their business.
You don't have to, but you certainly will make money if you accomplish all that. So far, so good.
Credit is what allows you to do that.
I don't get it. Are you the only person with credit? Do you have more credit than your competitors? Would anyone give you that much credit if you weren't already pushing your competitors out? "Having more credit" only makes a difference if you use it, which is the same as "having more debt." How does that help?
In addition, the fact that you have loans to pay means you are largely required by your creditors to grow.
Your creditors don't "largely require" you to do shit other than pay them
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You are however correct, that even without credit you would still see the same pattern, albeit much more slowly.
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With interest. Presumably if you can't afford it now but you can afford to pay extra later then you've done something profitable with the money in the meantime.
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Having a better project to invest in than your competitors do is what helps, not the debt itself. I'm not trying to argue "all debt is bad", just that "credit" by itself isn't the one and only way businesses anywhere make money.
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It's not just credit, but all forms of investment where the investor -- who is not involved in the actual production of goods and services -- supplies capital with the expectation to receive profit later. (And that profit has to be skimmed off the top of the productivity of the p
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Way to pimp your own post...
But the internet has very low barriers to entry, making it easy for small players like a couple of college kids to go big time (facebook, google, etc).
The next big thing could arrive any day. We don't know what it is because we are not there yet.
Ownership of much of the web can not be asserted by monopolies, and the bits that can become irrelevant soon enough.
That there are big players at any given point in time is no surprise, that most of the start ups fail is no surprise. Its
Re:Its not 'internet'. its 'free market'. (Score:5, Insightful)
That _WAS_ the case.
It took a couple of millions to start a let's say router company 10 years ago. Now you need 100M to just consider it.
It took a couple of millions to start a network management company 10 years ago. Now you need 30-50M.
It took a couple of millions to start an ISP 10 years ago. Now you need something on the order of a few 100M.
The "several guys in the garage making the next big thing" is the norm in any market in the beginning. HP was started in a garage. Apple was started in a garage. You cannot however start a computer company in a garage today. The Internet is quickly approaching that stage. The number of areas where there are still breakthroughs of garage companies is small and decreasing and this is normal for the development of the market.
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Way to pimp your own post...
yes. instead, we should type everything over and over again, for any fresh out of college, indoctrinated youngster that comes into slashdot and blabbers some 'ayn rand'.
But the internet has very low barriers to entry, making it easy for small players like a couple of college kids to go big time (facebook, google, etc).
internet HAD low barriers to entry, they are higher, and getting higher every day.
The next big thing could arrive any day. We don't know what it is because we are not there yet.
yeah, and this is the only phase where capitalism works - a new land rush. its not a stable system. it requires constant land rushes. and after every land rush, it reverts back to feudalism. so, the only ones who are enjoying the system are those on top, and th
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Way to pimp your own post...
yes. instead, we should type everything over and over again, for any fresh out of college, indoctrinated youngster that comes into slashdot and blabbers some 'ayn rand'.
Fresh out of college. Heh! You weren't even born back then sonny.
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Re:Its not 'internet'. its 'free market'. (Score:5, Insightful)
HA ! (Score:2)
'Free market' means muddled thinking (Score:5, Insightful)
The term "free market" is used to mean "competitive market" and is also used to mean "un-regulated market", despite the fact that few markets are both competitive and un-regulated. When someone uses the term "free market" with out clarifying which they mean, they are either confused, or they are trying to confuse you.
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There is no such thing as an un-regulated market.
Regulation will come either from a government answering to its voters, or a monopoly corporation answering to its shareholders. No matter how close those two alternatives may actually be, you cannot have a power vacuum and not expect it to be filled.
Re:'Free market' means muddled thinking (Score:5, Insightful)
The political innovation that made markets work so well is to counterbalance them with democracy, where the guiding principle is "one person one vote" (i.e. votes can't be traded away - the opposite of markets).
Governments are associated with monopolies when market forces overcome democratic forces within the government. Then you get illicit market activity, such as kickbacks, blackmail, and unwarranted granting of monopolies.
MPAA controls the US news media (Score:4, Informative)
The political innovation that made markets work so well is to counterbalance them with democracy, where the guiding principle is "one person one vote" (i.e. votes can't be traded away - the opposite of markets).
Mass media broke this. The parent companies of five movie studios [pineight.com] control U.S. television news, which in turn controls the general public's awareness of issues and of candidates. Notice that TV news hasn't covered ACTA or other issues where the public could stand to gain at the expense of the MPAA or vice versa.
Governments are associated with monopolies when market forces overcome democratic forces within the government.
This has in fact happened. U.S. voters by and large do what the TV tells them.
Re:'Free market' means muddled thinking (Score:4, Insightful)
A market isn't functioning, let alone "free", if there is a monopoly player in it. A monopoly is a market failure, and cannot be solved by the market. This is because the market for a monopoly product is a monopoly and its consumers.
You should study economics instead of Libertarianism. The differences are vast.
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Agreed, a market with a true monopoly player is not a free market.
Disagreed that it's necessarily a market failure. In every single instance I can think of, monopolies arise as the result of state interference in the market, either directly or indirectly, which only happens in command economies or "mixed" economies, not in free markets.
Studying economics, btw, is a common route to libertarianism.
You appear to be tragically uninformed.
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The "market" has no lobbyists or campaign contributions, the market is not a player, it is the field on which the players compete. Blaming the market itself for the actions of would-be monopolists is nonsensical. Like claiming the field is at fault when players cheat. The field is an inanimate object, it cannot be at fault in any meaningful sense. But
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If you can name an industry where an incumbent will have a lower cost of capital than the monopoly, I will call myself a Marxist. That is a BIG if.
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Terrible. Substitute "incumbent" with "newcomer".
belief. (Score:2)
there wasnt any government interference back in early 19th century to late 19th century. and, at the end of that period, america ended up being owned by FOUR persons, which can be named even today. vanderbilt to rockefeller.
the only way to prevent that, has been the regulations theodore roosevelt put.
simply ; in a dog eat dog world, you e
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Standard Oil controlled a vast majority of the refined oil market and did it without the force of government.
What a bunch of shit. I think the AC is right, you people ARE regurgitating crap from tenured socialists.
The railroad monopolies, created by the government, enabled the Standard Oil monopoly.
This is all right there in the decision by the courts in the Standard Oil anti-trust suit of 1909, where the court stated:
Almost everywhere the rates from the shipping points used exclusively, or almost exclusively, by the Standard are relatively lower than the rates from the shipping points of its competitors.
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It is government that is the organization holding the special right to employ coercion as a means, not "market forces". No private group can possibly hold that right; otherwise, they wouldn't be private at all, but an arm of government.
This is only partly true.
The Mafia uses force, and is not a part of government. Admittedly, they do not have a "legitimate" right to use force. But this isn't a question of legitimacy. It is a question of money and power.
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When a monopoly grows big enough, it becomes the effective government. No support from formal government is required. Free market alone has no means to break down huge monopolies that have reached the stage of effective government. This stage of monopoly is impervious even to ridiculous amounts of internal incompetence which could bring down earlier stages quite easily. If you disagree, please tell me just one feature of the free market that is capable of bringing monopoly in this stage down that doesn't require existence of another monopoly of similar size and explain how this feature works while interacting with said monopoly.
Oh PLEASE stop with this business that the 'corporations' are really the government! (Some of the) People who own them can vote in elections, the shares don't vote for politicians. In a truly free market, the government is not erecting barriers to competition. Even Standard Oil was getting competition back before they were 'broken up' (if you want to call it that) from companies out west. The phone company was ONLY a monopoly when the government made it a monopoly. If YOU want to argue, rather than lie,
god. (Score:3, Insightful)
if, a private entity owns all rights to a vast swath of land, all the resources and amenities that come from that swath of land, any rights that can be conceived over that land, arent they de facto ruler of that land ?
so, if someone owns a vast swath of land as large as idaho or arkansas, then arent they de facto the government of that land ? because they own all rights to it.
it is even the case today. the ONLY thing that is limiting their
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businesses do not have police power ? what do you think the private security firms are ? hell, in the last decade, that even reached private ARMY scale. blackwater is better equipped than any united states army platoon. already many companies take care of 'security' in their holdings ...
such naivete ...
You are using Blackwater, in their capacity as a GOVERNMENT contractor, all of their "police powers" coming from the government, demanded from the government even, as an example? HA!
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The government is a monopoly that survived without anyone protecting it.
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free market is what tends towards monopolies eventually. because there is competition, and nothing to prevent the big players from getting bigger
"Free market" means the government does nothing other than police fraud. A perfectly competitive market meets these conditions. [wikipedia.org] They overlap, but you can have a "free" market without it being anywhere close to competitive.
That aside, is the internet a "free" market? It comes pretty damn close. No one government can regulate more than a corner of it, for frau
sorry (Score:2)
its belief.
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Social networks have strong economies of scale - they're only useful if your friends are likely to be on it, and only large ones are likely to have your friends. This isn't true for the internet as a whole that right now supports oodles of competing search engines, commerce sites, news outlets, and blags.
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Sure, but is it necessarily a bad thing? The only problem is that people tend to put too much faith in the one winner and fail to diversify. What you need to do is make sure that you are keeping an eye on these large organizations and hold them accountable for their behavior. And in order to do that, you need to keep and open mind and make sure you have other options than dependance on them. I think maybe I'd better move out to the country and buy a ranch. Get some guns and fortify it in case I need to
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If all axes were independent--if every product were judged exactly on its merits, and used only and ever for what it was intended for--big players getting bigger until they reached saturation would in fact be the ideal. But the axes aren't, they're oblique, with a lot of nuances that will drag things in the wrong direction.
Say you were the first person to invent the hammer, and it swept the market. There's no reason to suspect that, being the hammer king, your product would replace screwdrivers, belt-sand
It's about scale. (Score:2)
When it comes to the internet I think it's all about scale, not necessarily free market. For example, what scale (infrastructure, etc) is required to generate and update a searchable index of the entire WWW? Isn't the main appeal of Facebook the number of users it has?
Being big is essentially a requirement - my point is whatever entity provides these specific services must be of at least a certain size in order to function or meet a critical mass of sustainability.
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nothing to prevent the big players from getting bigger,
This is a really bold statement. To back it up, I mean to really prove your point, you have to completely understand every single dynamic in the market, and how they all work, and verify that nothing prevents the big players from getting bigger.
Now, I don't claim to know every market dynamic, but I do know there are several that are working against things getting larger. One simple dynamic is the counter-culture, anti-bigness movement. We see it in Converse vs. Nike. Converse has a certain market that Ni
Re:Its not 'internet'. its 'free market'. (Score:4, Interesting)
Something I've come to see and realize over the years (yeah I'm getting a little older) is that as long as the market is free, there will always be competition. Always. No matter how big, no matter how dominant a company might seem, there is always some other equally big and successful company - usually in a slightly different market and looking for new opportunities.
And they are particularly attracted when a market has "fat" in it - which is usually the case when de facto cartels or monopolies have formed. But even in low-margin businesses, it remains the case. People are always scared that some big company is going to take over everything. The free market can seem 'scary' in that regard - but isn't.
Competition acts a bit slower than we'd usually like, but it always acts.
I find the article a bit ridiculous actually, and its basic premises are completely false ... the author claims there is monopoly domination, and proceeds to "prove" this by giving a long list of all strong companies that compete with one another, some fiercely. Apple, Google, Microsoft, all fierce competitors, all quite capable of providing similar services to the others. And the very existence of both Google and Facebook ARE textbook cases of how the Internet has allowed one or two 'garage coders' to become billionaires and compete with the other major players practically overnight. Apple, also started in a garage in the first place, was also almost dead very recently, and re-started itself afresh. These companies are proof of how incredibly competitive the industry is, and how easy it is for new small players to get in and grow.
Facebook had competition even when it launched, from services like MySpace and Friendster, both still going, and would step in in a minute. Google Buzz is another potential competitor to Facebook. They are everywhere. If Facebook disappeared, users would simply migrate to another service.
Slashdot Economics (Score:3, Insightful)
Only on slashdot would such economic bullshit (and the socioeconomic bullshit referenced within) get modded +5 insightful and repeated ad-nauseum. Free markets do NOT tend towards monopolies eventually. The vast majority of markets are not monopolies and are in no danger of becoming so, regardless of government intervention or regulation. The evidence on this is so overwhelming I wouldn't know where to begin. In fact, there are so few examples of natural/existing monopolies (where the efficient scale of
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In fact, there are so few examples of natural/existing monopolies (where the efficient scale of production exceeds the size of the market)
According to libertarian party line, there is no free market today, and there has, in fact, never been a true free market before (when the failure of the markets in 19th century which lead to the Gilded Age is pointed out, they're quick to say that it was still not free). So the low number of monopolies is entirely consistent with the claim that government regulation is required to keep it that way.
And yes, I'm an economist ... Imposing Libertarian views
That does not speak well of your credentials as an economist, then. It's like saying "I'm a physicist, promoti
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First, oligopoly is a far cry from monopoly. Barring collusion (which is illegal under anti-trust law) oligopoly markets can be extremely competitive, leading to razor-thin profit margins, low prices, rapid technological change, and consumer choice: compare the current mobile OS market to Windows in the 90s, or even the cell phone service market to pre-1980s AT&T.
Second, successful companies continue to grow to achieve scale efficiencies, but at some point, 'bigger' starts to bring its own problems of
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just like how the medieval peasants couldnt afford to go to a university city to see a real physician then, you cannot afford to go to switzerland to get treated by the best. start from
money (Score:2)
imho its all about the money. Look at things now compared to say 5 or even 10 years ago. Most small companies are bought up by a larger competitor, just to make sure they get there hands on whatever tech it is they are developing. Or another company is sued by another for some copyright or patent infringement just to make a buck. No real new 'big' fish are coming to light with something new cool and innovative, if so very slowly, as the big boys try to make sure they stay on top and squash that competition.
Interwhat? (Score:2)
Could it be that the free market on the Internet actually tends toward monopolies?
Free markets lead to successful companies. This is the same as in any other industry. Yes, the internet makes it very easy to just 'go with the flow' and follow the leader in a specific category but new companies and new leaders emerge regularly.
Just like with every other industry, if you sit back and watch it go by you'll see companies come and go. If you want to change things you've got to participate. The next "big thing" is in someone's basement or garage or spare room right now.
Bullshit. (Score:2)
ironically most of the above groups in different industries are either the same, or subsidiaries of bigger holdings.
what was about that 'come and go' bullshit again ? apparently they have come, and not going anywhere.
Perhaps there are reasons unrelated to monpolies (Score:5, Insightful)
Apparently, according to the author, MS's failure in search is purely down to Google's monopoly and completely unrelated to the fact that MS has in the past chosen to skew search results and hence proven itself to be an untrustworthy search provider? The "$40B cash on hand" number is meaningless, because MS hasn't chosen to spend $40B on entering the search market. Perhaps the difference is simply that Google has been able to develop and maintain a better product?
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"This isn't Wikipedia. Grow up!"
Exactly! Citations are only useful on Wikipedia. Who needs those silly things anywhere else?
How hard? (Score:5, Insightful)
How hard would it be to go a week without Google? Or, to up the ante, without Facebook, Amazon, Skype, Twitter, Apple, eBay and Google?
Pretty fucking easy, actually. My God what are we becoming when people think this shit is so important?
Back in my day (well, ok, my grandfather's) we worried about important shit like steel, or oil. Hell, even telephone wire - it's physical, someone owns it, and they control it completely. Those are monopolies - you're strangled by one provider.
Facebook? Apple? Amazon? Give me a fucking break. Oh noesies, I can't go read about something cute one of some guy I barely know's brat kids did! Oh no, I have to buy a less expensive version that functions just as well of some gadget I don't need! Uh oh, I have to walk my fat ass to Target or order from one of the other billion internet stores!
Author makes common mistake of confusing a monopoly with most successful provider of something that one could, if one wanted, get from 20 other places.
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Regardless, the difference here is that, with the internet vs. "physical things", network effects are in full play. Just as Ma Bell had a network monopoly (who's going to sign up for Joe's Phone Company when they can't call anyone because everyone else is on the Bell System?), and Microsoft had/has a certain sort of monopoly (who
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In the meanwhile, once Microsoft abandon Bing - what will index the internet, apart from Google ? Internet is growing fast, and it takes colossal amount of money to index a fraction of it. And that is without Google trying to something evil about its monopoly: exclusive indexing in exchange for better ads rate (I know a few companies tha
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How hard would it be to go a week without Google? Or, to up the ante, without Facebook, Amazon, Skype, Twitter, Apple, eBay and Google?
Pretty fucking easy, actually. My God what are we becoming when people think this shit is so important?
Some of us own or work for businesses that would not exist if it weren't for those services. Here's one example:
I know a guy who works as a consultant, he's the "guru" companies bring in when they realize that treating all of their employees like "cogs on a wheel" means they don't have any experts who understand both the minutiae and the big picture. He swears that over the last decade the kind of work he actually does has turned into excessive use of google-fu. Half the time he's looking up stuff with g
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Author makes common mistake of confusing a monopoly with most successful provider of something that one could, if one wanted, get from 20 other places.
You (and many of the other posters on this thread) have missed a key point:
The value of a network is proportional to the number of people using it.
This is easiest to see in the case of sites like Facebook. Sure, you could use a competitor, but if none of your friends are on it, what would be the point? If your peeps do all their communication through Facebook, and you want to get their updates, you need to use the Facebook. It's less clear-cut with sites like Google. I mean, you could use Bing for searc
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Whereas I agree we can survive without social networking and entertainment products, I'm not sure Internet search is so easily dispensed with.
Certainly, my job as a software developer would become approximately 5x more inefficient - the Internet is a treasure trove of problem solutions and basic and advanced reference information that is easily located.
In the old days (which I still remember), I'd have to order (often sight unseen) a bunch of books and hope they had the reference material I needed in them a
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Yahoo!, Bing, Ask, etc. are all still out there. Not quite as good as Google, but serviceable. The only way Google can keep its market share is by continuing to be better, because it's trivial to switch. There's no monopoly lock-in.
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The "Mona Lisa Effect" (Score:2)
Google and Amazon are possible because of a large crowd.
Facebook and Twitter and eBay don't work without a large existing crowd.
So you pick a site which already has a large crowd, thus creating a monopoly.
It's crashing the economy (Score:5, Insightful)
Our current market economy depends on finite supply, and with limited production capacity per person in order to employ people and pay them wages so they can also be consumers. As automation and robotics take over the means of production, only societies that can cope with overproduction with more socially shared resources will be able to thrive.
In other words, China and Europe will continue to eat our lunch.
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Excuse me? China (and to a very lesser extent Europe, you probably mean mostly Germany) are 'eating' your lunch because the gov't created monopolies destroyed competition in USA by using gov't as means to destroy free market and to get themselves all the subsidies and regulations that keep out the new startups, so then once the economy became global the monopolies could easily outsource the labor to cheaper locations.
But if the market in US was actually free and gov't didn't destroy the liberties in it: did
Re:It's crashing the economy (Score:4, Insightful)
wow. Even by the (frankly bizarre) standards of the US that's a fairly extreme viewpoint. Whilst I don't want to feed the (very dedicated) troll too much, a few points:
1. You seem to think that the reason that China is producing is lack of government interference. Firstly that is simply not true as many industries in China are effectively nationalised. Secondly, some level of government regulation is generally recognised as a Good Thing, to try and reduce excessive pollution and other externalities. Growing the economy has to be balanced with keeping your cities inhabitable. Judging by the air quality in many big Chinese cities, some might say they haven't got the balance right yet.
2. The idea that if the government would only stop interfering then everything would be great is demonstrably wrong. For one thing, you can look at countries where there is little to no governance (Yemen for example) to see that things are far from great. Whilst less government interference can indeed lead to great gains for some, the experience has too often been that the majority of people experience something very different. The industrial revolution brought great gains, but in the short term the life expectancy of the UK dropped. Yearning to return to a Dickensian age where great industrialists make lots of money whilst the majority live in grinding poverty seems somewhat perverse.
3. Monopolies have tended to spring up around many new industries: railways, Bell telephone, Standard Oil etc. By and large these have started as unregulated businesses, but economies of scale have tended to benefit the largest companies. This then leads to a small number of companies dominating the field. Often it has been up to governments to step in and break up companies (Bell, Standard), and is why competition commissions have been set up to try and maintain a competitive market by breaking up cartels.
4. You seem to have a pet peeve about income tax. I realise this is a matter of personal conviction, but one of the jobs of government is to try and correct what we (the people / voters) perceive as inequalities or injustices in the (mainly) free market system. Whilst you might be perfectly happy with huge inequalities, I think most people prefer a world in which there was some sort of safety net, and in which losing your job doesn't mean living on the street. If only for the selfish reason that those on benefits/welfare are probably less likely to rob you out of desperation.
Bullshit (Score:5, Insightful)
3. I don't care if ANYBODY thinks gov't regulations is a 'good thing'. Gov't is terrible from my perspective for every single one thing completely and fully.
So, children should still be working underground until they die from exposure to their working conditions? Workers should be born into debt to the company hospital? Slavery should still exist if it's economically viable?
Really, no one takes you seriously except for yourself.
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Yes, you'd be better off with no income tax. The gov't shouldn't be providing any services in the first place, and it's obvious that you don't understand now, that the services they are 'providing' are a pyramid scam that will fall soon, no better than B. Madoff's scam was, only on a larger scale.
Also it is correct, it's better not to regulate businesses but only given that the gov't also does not subsidize them in any way. Leave the businesses to survive or die on their own competing one against another.
Al
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Our current market economy depends on finite supply, and with limited production capacity per person in order to employ people and pay them wages so they can also be consumers. As automation and robotics take over the means of production, only societies that can cope with overproduction with more socially shared resources will be able to thrive.
That hasn't been true since the Industrial Age. Production capability has increased vastly since the 17th Century.
In other words, China and Europe will continue to eat our lunch.
Why? They don't appear to me to better "cope with overproduction with more socially shared resources". Instead, the US appears to be screwing the pooch with a rapidly growing economic parasitism.
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...only societies that can cope with overproduction with more socially shared resources will be able to thrive.
That hasn't been true since the Industrial Age. Production capability has increased vastly since the 17th Century.
Take a look at this graph [blogspot.com]. Your assumptions are incorrect.
In other words, China and Europe will continue to eat our lunch.
Why? They don't appear to me to better "cope with overproduction with more socially shared resources". Instead, the US appears to be screwing the pooch with a rapidly growing economic parasitism.
Nationalized infrastructure, like health care, roads, rail, energy production, research and development, and education are the very definition of socially shared resources. It's accomplished in different ways -- heavy regulation or direct governmental control -- but the effect is similar.
Whereas Americans are for some reason allergic to throwing in with the rest of their citizens, the rest of industrialized society has accepted shared risk as a benef
More sensationalist meaningless drivel (Score:3, Insightful)
This article is full of sensationalist bullshit.
Facebook, Amazon, Skype, Twitter, Apple, eBay and Google
Yes, one can do comfortably without all these. I don't shop at Amazon, instead, I shop at several other places, which vigorously compete with Amazon.
I've never used online auction site, and still manage to buy shit online cheaply.
I check my facebook account once a week if that, and I still manage.
I switch between several search engines, and I think they've gone more or less on par.
Twitter and Apple? Monopolies? Lolwut.
It seems the author isn't very well versed in economics and uses words like "monopoly" and "free market" colloquially.
Also, he has his bearings wrong. The only thing that allows any kind of "monopoly" in information is the government and its fucked up system of copyright and related rights, which is being tended by lawyers who are probably students of the author in the quagmire of "Intellectual property". Now, this is the REAL danger, but he somehow misses it altogether.
Not impressive at all.
Maybe the professor should concentrate on his studies in law, and not venture with superficial sensationalism in areas he doesn't know much about -- like economics -- before learning the basics.
Pretty Good Article About the Network Effect (Score:2)
Surprise surprise - capitalism on the internet is largely about companies dominated by the network effect. It is interesting, though, that while many folks thought the internet would lead to a broader spectrum of companies given that start up/fixed costs are so low, the network effect has tended to consolidate power to a very small number of winners.
I think the overall effect on capitalism itself will be very interesting. Capitalism was always about winners and losers, but previously you could have a lot mo
Flawed premise (Score:2)
This whole premise is flawed a true monopoly of information in the traditional sense is not really happening on the Internet as far as I can tell. Sure the vast majority of people see Facebook as the Ineternet and spend entirely too much time on there posting inane updates, doing inane quizzes and playing terrible web games. However that does not stop Slashdot, Reddit or Penny Arcade or xckcd or hack a day or cnczone from existng and doing just fine for people that want or have a thought rattling around bet
I quit reading TFA at; (Score:4, Insightful)
> Forgoing Google and Amazon is just
> inconvenient; forgoing Facebook or Twitter
> means giving up whole categories of activity.
I don't use facebook or twitter, but use google on a daily basis & amazon on a weekly basis.
Anyone that claims to not be able to live without twitter/facebook is not someone I wanna hang out with regularly. Or read what they have to say about tech :P
Well, duh! (Score:2, Interesting)
"Could it be that the free market ... actually tends toward monopolies?"
That's economics 101: economy of scale means that a pure free market tends to monopoly. Why anyone should expect the Internet to be different escapes me. The usual argument is that the role of the government in a free market economy is to provide regulation to limit this tendency: first, by preventing the abuse of the monopoly (to prevent competition, or to take over related fields), and second, by limiting the maximum size of compani
Google as a monopoly (Score:2)
Google is a monopoly as long as the alternatives suck.
Seriously.
I have yet to see Bing, Yahoo, Altavista, Webcrawler, Lycos, etc, bring their products up to speed to offer better alternatives to Google's offerings.
There is nothing stopping Microsoft making Bing a successful alternative to Google except maybe the poor algorithms they use.
Oh yeah, and where are my advanced search functions, Bing?
--
BMO
Re: (Score:2)
The problem is that Bing is too much focused on the average user. What google does right is that they are appealing to techies, and this gives them all sorts of extra benefits that MS is not getting.
What irony that comes from Murdoch. (Score:2)
Tim Wu has a piece up at the Wall Street Journal
They speak of hating monopolies, yet that's what Murdoch wants to be.
big and small monopolies (Score:2)
TFA refers to big monopolies that are familiar to us all, but there are millions of small monopolies that also drive business.
The USPTO gives monopolies to businesses and individuals in the form of Patents, Trademarks and copyright.
Exclusive rights to something of value confer power to the owner. This is the core strength of all the big monopolies mentioned.
Your local shoe repair shop will never have power because it owns no IP or other exclusive rights.
Your local gas station is in the same situation except
Am I getting this right? (Score:2)
Guide to surviving without The Internet Monopolies (Score:2)
Facebook:
http://opensource.appleseedproject.org/ [appleseedproject.org]
http://www.joindiaspora.com/ [joindiaspora.com]
http://www.myspace.com/ [myspace.com]
Amazon:
http://www.bookfinder.com/about/booksellers/ [bookfinder.com]
Skype:
http://en.wikipedia.org/wiki/Comparison_of_VoIP_software [wikipedia.org]
Twitter:
http://en.wikipedia.org/wiki/Tumblr [wikipedia.org]
http://www.plurk.com/ [plurk.com]
Apple:
http://www.microsoft.com/en/us/default.aspx [microsoft.com]
http://www.ubuntu.com/ [ubuntu.com]
eBay:
http://online-auction-sites.toptenreviews.com/ [toptenreviews.com]
Google:
http://www.thesearchenginelist.com/ [thesearchenginelist.com]
Re: (Score:2, Insightful)
In the absence of regulation, free markets always end up as monopolies. Not sometimes but always.
Name three.
Back in the real world, actual, real monopolies can only exist if:
a) the monopoly is more efficient than any competitor, thereby providing better service to their customers.
or:
b) the government keeps competitors out of the market.
In many cases in communications, governments built the initial infrastructure using its powers to take land from its owners at gunpoint, and then handed it over to private companies, which no new company can easily compete with since they don't have such powers. Similarl
Re: (Score:2)
And if you want to complain about the second link, note that an Oligopoly is just a point on the asymptotic slide towards a Monopoly. Gobbling up competitors becomes more difficult as they become larger and the benefits of gaining a monopoly decrease as the the number of competitors decrease, at least as long as those competitors are amenable to a little group price-fixing.
Even so, given enough time and the lack of any outside intervention, eventually oligopolies will collapse
Re: (Score:3, Insightful)
The idea is that to make a higher profit, to be more efficient, one has to serve the demands of the customer to gain the business required to make a higher profit.
This is not what economic efficiency means.
And the idea is wrong.
A monopoly will be economically inefficient, specifically because it maximizes profits, and is in a position to control prices. That means that the prices it sets will be greater than the marginal cost of production.
In a competitive market, the marginal cost of production equals the
Re: (Score:2)
Regulated sectors tend not to have that happen as the first thing that regulators like to do is put into place measures that make companies actually compete.
Re:What a shocker (Score:4, Insightful)
Maybe you should look up the East India Company.
Citation needed by parent poster (Score:2)
N/T
Re: (Score:2)
I don't really think those are particularly good examples of what you're intending to say.
Re: (Score:2)
"Americans should be vigilant against corrupt use of government power and the promises of politicians."
Yes, they should. But the fact remains that they aren't. This is how there's actually people that support bills/laws/treaties such as the Patriot Act. That's how there are actually people that support the blatant invasions of privacy and freedom at airports. The average indoctrinated drone believes that they are making a difference by voting in the same two parties over and over.
"Our government is founded
Re: (Score:3, Insightful)
That's not true at all.
Google is a monopoly because there is currently no better alternative. Altavista was a monopoly for exactly the same reasons, until Google came along.
Ironically in fact, 13 years on, Google is currently no better that Altavista was. Since every POS on Earth has figured out how to game Google, the number of link-farm results in the first page is becoming as overwhelming as the tag-spammed results in Altavsita once w
Re: (Score:3, Insightful)
Search is currently no better than it was 10, 15, 20 years ago.
20 years ago?
Really?
--
BMO
Re: (Score:3, Funny)
Search is currently no better than it was 10, 15, 20 years ago.
20 years ago?
Really?
--
BMO
Yes. 20 years ago I could very easily search all existing web sites. :-)
Re: (Score:2)
Google is a monopoly because there is currently no better alternative. Altavista was a monopoly for exactly the same reasons, until Google came along.
Try the competition, IMHO they aren't any worse either. The main advantage that Google has over them is more hardware and more sweeps across the net. Which for many things is an advantage, but most of the information that people are looking for is at least a few days old.
Re: (Score:2)
Your Latin needs some rework.
But let's take the implication that awesomeness==monopoly. Nope. Google, while attempting world domination, has lots of great competition breathing down its neck, and has rotten product quality. Score: as awesomeness != monopoly, zero so far.
The local telco is a de legis monopoly. The jure is still out. Score, as they were voted into power (by a bribed legislature nationally, and by state across the US, and by fiat in many countries during the PTT era, we'll agree).
Monopolies in
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Re: (Score:2)
I didn't say I savored that method. Rather, Sun Tzu's _Art of War_ seems the way that business is done these days, as the Darwinian Branch of capitalism rules.
Re: (Score:2)
The whole thing about "individualism" and being an "individual" appears to mean something different from what it sounds like - comes with an evaluation of how much (?!) of an individual you are.
The view appears to be: since we cherish the perception of how everyone has the opportunity to excel, we should honor those who do so since they are the representation of true individualism (which gives the word a whole new meaning)
It follows that those who don't excel need to recognize that and pay deference to thos
Re: (Score:2)
This is actually what TFA says.