Let's see, are there any important markets out there today where a company has a monopoly? Well, there's the tablet market I guess, where Apple has 95% marketshare. But that's merely a $40 billion a year business with a 70% year over year growth rate so it's not really worth considering, right?
And as we all know Apple would never use strong arm tactics like excessive patent litigation to try to hamstring its competitors. And thank goodness that they promote an open platform where anyone can run whatever software they want.
Edit: the 95% figure is a bit out of date, however Apple's revenue marketshare in tablets still remains quite high (around 90% in 2011 and even in 2012).
Edit #2: For reference, when Standard Oil was brought to court on anti-trust charges they had a 70% market share. And US Steel in its heydey only controlled 2/3 of the market.
Also, even if it was 95%, there are clearly competitors with momentum, and you could probably argue that the tablet market isn't really distinct from the smartphone market. But really, it seems like it's way less than 95%. No monopoly.
> But really, it seems like it's way less than 95%. No monopoly.
Although there are no hard and fast rules, to be considered a Monopoly in the UK, for example, you only need to have a minimum 25% market share.
http://en.wikipedia.org/wiki/Monopoly
That seems like a strange definition. I guess both Apple and Google have monopolies in the tablet market, then, by the UK definition. Although that obviously seems contradictory.
I'm going by the typical colloquial definition (which might be closer to the real definition outside the UK), that a monopoly is when there's basically just one option and that market dominance can be used to harm competitors and consumers.
25% market share isn't 'the definition' of a monopoly in the UK, as far as I'm aware (IANAL or in any way an expert in this).
It's one of the necessary (but not sufficient) conditions for the OFT to refer a merger to the Competition Commission for investigation under the Enterprise Act[1], if the result would have greater than 25% market share. The other main conditions being that it believes the result would be "a lessening of competition", that it's an important market, etc. That doesn't suddenly make every company with >25% market share a monopoly.
The nearest I can find for the definition of a monopoly, for the purposes of investigating a company on its own (rather than a merger) is "a dominant position in a market"[2], the wording imported from Article 102 TFEU[3].
Amazon has credibly claimed that the Kindle Fire has 20% market share. The Nook also has some not insignificant share. Even adding up the also-rans will probably get 3-5 more percent.
This is important because there is an inflection point where you are not allowed to use your monopoly in other markets -- that might be at 95%, but probably not at 75%.
I am making no judgement on their practices -- just correcting market share and when they may or may not be within the law.
I'd say that both Apple and Google both have monopolies over app sales within their ecosystems. And at least one of them seems to be abusing this monopoly power.
Comments
Let's see, are there any important markets out there today where a company has a monopoly? Well, there's the tablet market I guess, where Apple has 95% marketshare. But that's merely a $40 billion a year business with a 70% year over year growth rate so it's not really worth considering, right?
And as we all know Apple would never use strong arm tactics like excessive patent litigation to try to hamstring its competitors. And thank goodness that they promote an open platform where anyone can run whatever software they want.
Edit: the 95% figure is a bit out of date, however Apple's revenue marketshare in tablets still remains quite high (around 90% in 2011 and even in 2012).
Edit #2: For reference, when Standard Oil was brought to court on anti-trust charges they had a 70% market share. And US Steel in its heydey only controlled 2/3 of the market.
95% market share? Where are you getting that from?
This says 65%: http://www.bgr.com/2012/08/14/ipad-market-share-all-time-hig...
This says 52%: http://www.forbes.com/sites/larrymagid/2012/10/02/android-co...
Try again?
Also, even if it was 95%, there are clearly competitors with momentum, and you could probably argue that the tablet market isn't really distinct from the smartphone market. But really, it seems like it's way less than 95%. No monopoly.
> But really, it seems like it's way less than 95%. No monopoly.
Although there are no hard and fast rules, to be considered a Monopoly in the UK, for example, you only need to have a minimum 25% market share. http://en.wikipedia.org/wiki/Monopoly
That seems like a strange definition. I guess both Apple and Google have monopolies in the tablet market, then, by the UK definition. Although that obviously seems contradictory.
I'm going by the typical colloquial definition (which might be closer to the real definition outside the UK), that a monopoly is when there's basically just one option and that market dominance can be used to harm competitors and consumers.
25% market share isn't 'the definition' of a monopoly in the UK, as far as I'm aware (IANAL or in any way an expert in this).
It's one of the necessary (but not sufficient) conditions for the OFT to refer a merger to the Competition Commission for investigation under the Enterprise Act[1], if the result would have greater than 25% market share. The other main conditions being that it believes the result would be "a lessening of competition", that it's an important market, etc. That doesn't suddenly make every company with >25% market share a monopoly.
The nearest I can find for the definition of a monopoly, for the purposes of investigating a company on its own (rather than a merger) is "a dominant position in a market"[2], the wording imported from Article 102 TFEU[3].
[1] http://www.legislation.gov.uk/ukpga/2002/40
[2] http://www.legislation.gov.uk/ukpga/1998/41
[3] http://en.wikipedia.org/wiki/Article_102_of_the_Treaty_on_th...
Amazon has credibly claimed that the Kindle Fire has 20% market share. The Nook also has some not insignificant share. Even adding up the also-rans will probably get 3-5 more percent.
This is important because there is an inflection point where you are not allowed to use your monopoly in other markets -- that might be at 95%, but probably not at 75%.
I am making no judgement on their practices -- just correcting market share and when they may or may not be within the law.
I'd say that both Apple and Google both have monopolies over app sales within their ecosystems. And at least one of them seems to be abusing this monopoly power.
Walmart has a monopoly on items you can buy at the checkout counters inside of their stores.
The law cares about using earned monopoly power in one market to advantage yourself in another market.