"Google’s market share in digital advertising is only 30% to 40% or so (and declining) — far lower than the share typically required to establish monopoly power."
What is the rationale for these percentages?
I imagine a world in which only small and medium sized companies exist. In such a world 5% would be already gigantic.
The laws weren't written to prevent 'big', they were written to prevent 'monopoly'.
Basically, if you've got 30% of the market share then there's either other players as big as you, or a LOT of small ones. Either way, in theory there should be enough competition to keep you honest.
If you have 90-100% market share, then you can start saying to your customers 'by the way, my product now costs twice as much and is half the size, just because I feel like it', and they can't respond by going to a competitor because there isn't one who can actually compete.
I think Matt Stoller paints a different picture in his book. The laws were written to limit corporate power. 30% in the US can mean close to 100% in certain regions. And it is not only about monopoly, it is also about monopsony.
“Cigarettes or drugs” is an illuminating comparison. Persons in my age group remember when cigarette advertising dominated the page, the screen and the landscape in everyone’s view. I am an artist, and learned just this weekend that a photograph of a cowboy leaning back with a lit cigarette was rejected from an exhibition earlier this year. It does seem that legal drug ads have replaced cigarette ads, but I think what the writer of that memo referred to was illegal substances: as with cigarettes, something the government has taken steps to protect the citizens being exposed to.
"We could mostly ignore the demand side of Economics"
That's a really incriminating line admitting monopoly power right there.
"Google’s market share in digital advertising is only 30% to 40% or so (and declining) — far lower than the share typically required to establish monopoly power."
What is the rationale for these percentages?
I imagine a world in which only small and medium sized companies exist. In such a world 5% would be already gigantic.
The laws weren't written to prevent 'big', they were written to prevent 'monopoly'.
Basically, if you've got 30% of the market share then there's either other players as big as you, or a LOT of small ones. Either way, in theory there should be enough competition to keep you honest.
If you have 90-100% market share, then you can start saying to your customers 'by the way, my product now costs twice as much and is half the size, just because I feel like it', and they can't respond by going to a competitor because there isn't one who can actually compete.
I think Matt Stoller paints a different picture in his book. The laws were written to limit corporate power. 30% in the US can mean close to 100% in certain regions. And it is not only about monopoly, it is also about monopsony.
Another fascinating overview.
“Cigarettes or drugs” is an illuminating comparison. Persons in my age group remember when cigarette advertising dominated the page, the screen and the landscape in everyone’s view. I am an artist, and learned just this weekend that a photograph of a cowboy leaning back with a lit cigarette was rejected from an exhibition earlier this year. It does seem that legal drug ads have replaced cigarette ads, but I think what the writer of that memo referred to was illegal substances: as with cigarettes, something the government has taken steps to protect the citizens being exposed to.
Huh, I'd totally forgotten iOS Safari ever had a split webaddress/search bar area.