Issue 531 Digital Monopolies: Break them? February 19, 2015

A business monopoly is a business that has total control over a specific area of business.  A digital one, is the same concept, but just pertains to the internet.  In the past, these things we call monopolies have been deemed very bad and that they cause high prices, and other negative impacts on the economy.  Well, that is not really the case with internet monopolies, so let us discuss.

Why digital monopolies are harmless:  A digital monopoly is basically a digital giant like Facebook, which controls most of the social networking area of the internet.  Google controls searches and Amazon selling goods.  However, we are not limited to them to buying, searching or socializing on the internet.  Numerous others still exist like Myspace, FaceTime, Bing, Go Daddy and the like.  Despite being smaller, we can still use their services.  In contrast, the original monopolies on trains, oil and the like had true monopolies where no other services could compete.  In the digital landscape, everyone no matter how big is replaceable.  And in fact, because giants like Google, Facebook and Amazon are replaceable we know that they are not real monopolies.  They are just really good companies that the world has recognized and thus they will continue to be used so long as their services continue to be useful to the masses.  You see, all the internet giants can be supplanted by others.  Bing, or another upstart as a search engine could possibly one day take the leading role over Google.  And this cycle can happen to that replacement as well.  

But what about when they buy their competitors or upstarts you say?  Simple, the buying of competitors and upstarts is a good thing.  For one, it may introduce new services that we do not have yet to existing ones we use.  So Google may add the new service, but so will Bing, and others because if you have not noticed, they copy each other’s successes.  Thus, if enough good ideas are focused into one place outside of these giants, Google, Facebook and the like could be replaced.  What this also means is that the acquisitions sponsor more startups.  Some hope to create a useful service that will become just as big as Facebook or Google, while others create ideas that they seek to be bought in the first place.  As such, more variety is created with more unique possibilities for us consumers to enjoy.

Conclusion:  All roads lead to innovation.  The fact is, monopolies on the internet really do not exist, for costs to create something on the internet is very small (though keeping it going may not).  Right now, I am enjoying Google's' free blogging service to reach you, my readers, but some day, a better service may come along and replace Google, or even buy them if they become big enough.  As business constantly reinvents itself along with innovations on goods and services, those who remain stagnant will fall by the wayside.  It is the creative destruction of the market, and I look forward to seeing where it will lead the internet.  So no, do not break Google, Amazon, Facebook, or the others.  They are doing their part to create an even better internet.