Google, Amazon and Facebook are following the same playbook. Ironically, if the Department of Justice had not sued Microsoft to stop its anticompetitive behavior, Google might not exist! After taking over the internet browser market, Microsoft could have required computer makers to use its own search engine, too. Rather than competing on the merits, Microsoft used its monopoly power to try to take over the internet browser market. The court held that Microsoft used its monopoly power in “Intel-compatible desktop PC operating systems” to squash the Netscape browser by requiring computer makers to instead install Microsoft’s own Internet Explorer browser. Microsoft illustrates how today’s tech giants are breaking the law. So how do the tech platforms use exclusionary conduct to acquire and maintain monopoly power? Let me count the ways. The closest substitute to Facebook is Instagram, which isn’t much of a choice since Facebook owns it. You can’t see baby pictures on LinkedIn, and you can’t keep in touch with Grandma on Twitter. Switching is important because only if consumers can readily vote with their feet do other companies competitively constrain the tech platforms.įacebook, for example, doesn’t need to have a monopoly over a market as broad as “all social media.” All social media platforms are not substitutes for Facebook. The platforms define the markets they operate in broadly, as in “all e-commerce,” “all social media,” or “all mobile operating systems,” rather than limiting the markets to substitutes that consumers would easily switch to. ![]() A market for antitrust purposes includes only those options that consumers would switch to when prices went up or quality went down a small amount.Įach tech company maintains that it does not have monopoly power, despite the examples below of their power to exclude competition. Google ( GOOGL), Facebook ( FB) and Amazon ( AMZN) have monopoly power in their respective markets. Monopoly power is the ability to control prices or exclude competition for a particular product or service. To do so, a company must also have acquired or maintained its monopoly power using exclusionary conduct. Competition maximizes consumer choice, innovation and quality, and combats the concentration of economic and political power.īeing big on its own does not violate the Sherman Act. The Sherman Act makes no mention of prices, and low prices should not be the only goal. But consumers pay for tech platforms’ services with data, not dollars. Why, then, isn’t anything being done about Big Tech violating the Sherman Act? In recent decades, corporate defendants have persuaded judges to narrow the law, by requiring, for instance, evidence of price increases to prove a case. When passing the law, Senator John Sherman declared, “If we would not submit to an emperor, we should not submit to an autocrat of trade…”Ĭompetition maximizes consumer choice, innovation and quality, and combats the concentration of economic and political power.” It was made precisely for the highly concentrated power we see today in Big Tech. ![]() The Sherman Act was created to combat juggernauts that ruled entire industries like oil and railroads. ![]() Much like our Constitution, the Sherman Act was written broadly enough to handle whatever the future might hold. If you think an antitrust law passed over a century ago couldn’t possibly address the problems of the digital era, you’re wrong. Big Tech is violating the Sherman Act of 1890. And I’m not talking about Facebook handing over your personal data to the highest bidder or Amazon playing puppeteer in its HQ2 charade.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |