There is nothing improper or illegal about Google’s monopoly – like Microsoft and IBM before it, it earned that dominance fair and square. And given the dynamic nature of the technology sector, it would probably be counterproductive to prevent Google from using its money and talent to expand into new areas.
Where I have a problem, however, is in allowing Google to buy its way into new markets and new technologies, particularly when the firms being bought already have a dominant position in their respective market niches.
That was certainly the case with the company’s recent acquisitions of You Tube, DoubleClick and AdMob. It is the case with Google’s proposed $700 million acquisition of ITA Software, the leading provider of software used in online searches for airline flights, which is currently under review by the Justice Department. And it surely would have been the case with Groupon, the local Web advertising company, had the hot startup decided last month to accept Google’s reported eye-popping $6 billion offer.
In theory, antitrust laws were meant to restrict such acquisitions by a monopolist. In practice, however, it hasn’t worked out that way….
The ease with which Google has been able to extend its dominance reflects, in large part, the inability to adapt century-old antitrust laws to the quite-different economics of a high-tech economy that is susceptible to winner-take-all competition.
Nel mio seminario sugli ingredienti digitli, che forse qualcuno di voi ricorda, ho una slide con una foto degli ABBA.. (the winner takes it all)
These are also markets where customers tend to prefer the company that has the most other customers – what economist call a “network effect.” …
Antitrust regulators are well aware of these new economic realities. … But so far, neither the Justice Department nor the Federal Trade Commission has been willing to use them to mount a broad challenge to Google and its strategy of using acquisitions to expand and protect its existing monopoly.
Regulators are painfully aware of the legal as well as the political risks of mounting such a challenge. But it is worth remembering that aggressive enforcement of the antitrust laws has been a crucial part of the history of technological innovation in this country, enforcement that allowed AT&T to be supplanted by IBM, IBM by Microsoft and Microsoft by Google.
It’s easy to see why Google would want to use well-chosen acquisitions to try to delay or prevent that next round of creative destruction. What’s harder to understand is why we would let them do it.
perche’ tanto c’e’ l’Europa e ci pensa l’europa a bloccare le espansioni in mercati adiacenti per aumentare la concorrenza, come e’ successo a microsoft con media player.
succederà anche a Google, imho.