6 ms·

This is false. There are so called 'natural monopolies' where one large firm really is more efficient than multiple smaller ones. A popular example is google se

This is false. There are so called 'natural monopolies' where one large firm really is more efficient than multiple smaller ones. A popular example is google search. Of course, if that monopoly starts engaging in serious rent seeking behaviour, competition could become profitable again.

guynamedloren 14y ago
Give me a solid alternative and I'll stop using Google search. Until then, don't care if Google is a 'natural monopoly' - it does absolutely everything I want it to do and I occasionally click on advertisements from which they profit. It's a mutually beneficial relationship and I see no reason to switch. Net positive.
- freehunter 14y ago
  This is a problem with monopolies, though. Their competitors can't gain marketshare by being better but not better enough. Take Microsoft's monopoly in the 90's. There were competitors and it could be argued they were better, but they weren't better enough to justify switching to them. Even being of the same quality, the monopoly will continue to gain marketshare not because of being better but because of being bigger.
  - greiskul 14y ago
    Microsoft is a natural monopoly because of the network effects between number of consumers of an OS and number of developers for an OS. What makes Google a natural monopoly?
    - freehunter 14y ago
      I wasn't responding to Google being (or not being) a natural monopoly, I was responding to "Google is what I use, and it's what I use because it's Google". On your point, it could be argued that Google's overall platform dominance might not be attributed to barriers to entry, but rather barriers to exit. While Google offers some of your data back to you in a portable format it's still quite difficult to leave their services, and even when you do they will still be tracking you for advertising. To form their potential natural monopoly in your mind, you can imagine how difficult and inefficient it would be to have multiple different firms tracking you to the same extent that Google does (search, Google+, Gmail, calendar, Google Docs). I am not an amateur economist.

guynamedloren 14y ago

Give me a solid alternative and I'll stop using Google search. Until then, don't care if Google is a 'natural monopoly' - it does absolutely everything I want it to do and I occasionally click on advertisements from which they profit. It's a mutually beneficial relationship and I see no reason to switch. Net positive.

freehunter 14y ago
This is a problem with monopolies, though. Their competitors can't gain marketshare by being better but not better enough. Take Microsoft's monopoly in the 90's. There were competitors and it could be argued they were better, but they weren't better enough to justify switching to them. Even being of the same quality, the monopoly will continue to gain marketshare not because of being better but because of being bigger.
- greiskul 14y ago
  Microsoft is a natural monopoly because of the network effects between number of consumers of an OS and number of developers for an OS. What makes Google a natural monopoly?
  - freehunter 14y ago
    I wasn't responding to Google being (or not being) a natural monopoly, I was responding to "Google is what I use, and it's what I use because it's Google". On your point, it could be argued that Google's overall platform dominance might not be attributed to barriers to entry, but rather barriers to exit. While Google offers some of your data back to you in a portable format it's still quite difficult to leave their services, and even when you do they will still be tracking you for advertising. To form their potential natural monopoly in your mind, you can imagine how difficult and inefficient it would be to have multiple different firms tracking you to the same extent that Google does (search, Google+, Gmail, calendar, Google Docs). I am not an amateur economist.