ProMarket

If you are a capitalist, you should be pro-acquisition (i.e. of smaller firms) and anti-merger (for larger firms), because mergers are a form of crony capitalism that leads to reduced product quality and market dysfunction.

First, merging firms reduce the number of products they sell, with the effects materializing one year after the M&A and accelerating over the next several years. Second, merging firms tend to drop and add products at the periphery of their joint product portfolio. Third, the net effect is an increase in the similarity among the products that firms offer following a merger or acquisition. from: https://www.promarket.org/2023/10/02/merged-firms-offer-less-product-variety/

This finding has been consistently true since people have started measuring merger outcomes, "we find that each merger is associated with a quality decrease (increase) in markets where the merging firms had (had no) pre-merger competition with each other, and the quality change can have a U-shaped relationship with pre-merger competition intensity. Consumer gains/losses associated with quality changes, which we monetize, are substantial " – https://www.sciencedirect.com/science/article/abs/pii/S0167718717301121

It is doubtful that merging two companies would have improved the EU's capability to compete with Chinese state operators. On the other hand, lowering the capital threshold to create a new entrant would definitely improve the EU's competitive position and…

Leans back in rocking chair, tamps pipe.

When I was younger I used to code in C and C++. Borland compiler and IDE tools were my favourite. From what I recall Microsoft stomped all over them. It was my first introduction Big Tech. I loved DOS (yes DOS!) and I was getting to learn Windows but I felt that Microsoft was stifling its competition by abusing its dominance of the PC OS market. I was young and naive and had never heard of Free (as in freedom) Software and Open Source was a term that was yet to be coined.

(I'm going somewhere relevant with this.)

When Linux came along it made a few small ripples, I jumped on board when it was maybe six or seven years old – a beat up PC running Slackware was being used as a router connected to an ISDN line in a business park I interned at. Some dude explained roughly how it worked and gave me a burnt CD. I had to figure out how to load CD drivers manually, compile the kernel manually, I learned so much. And in time I learned about FOSS and GNU and Stallman and the GPL. I thought, wow – that's a neat hack – using the legal system to guarantee freedoms. Giving people control over their devices, and way less of an opportunity for a big company to stifle it. I was a convert.

We're been at the Ad/Data Lock-in/Surveillance Tech equivalent of Stallman and the mythical printer for over a decade now. I personally think our modern Borland moment was when Facebook was allowed to buy Instagram (2012). That should never have been allowed by…

You could go back a couple of decades earlier (1960s--1980s) and point at AT&T who specifically prohibited third-party devices on their network (answering machines and even neck-rests or phone-book covers were among the prohibited items),[1] and had flatly rejected packet-switched routing as an obvious threat to their monopoly.[2]

Unix itself (and Linux, Android, and MacOS) wouldn't have existed save for a 1954 consent decree which prohibited AT&T from entering the software business.[3] When the company found itself with an accidental operating system the only thing they could do was give it away for free. "From Ken with love".[4]

________________________________

Notes:

1. Partially supported here: <https://www.promarket.org/2023/02/20/when-considering-breaking-up-big-tech-we-should-look-back-to-att/>. Phone book covers was AT&T v. Winback & Conserve Program, Inc. Hush-a-Phone was an earlier case in 1956 involving a cup-like device, physical only, with no electrical or electronic components: <https://en.wikipedia.org/wiki/Hush-A-Phone_Corp._v._United_States>.

2. <https://en.wikipedia.org/wiki/Protocol_Wars#Early_computer_networking>

3. <https://arstechnica.com/tech-policy/2011/07/should-we-thank-for-feds-for-the-success-of-unix/> <https://www.aeaweb.org/articles?id=10.1257/pol.20190086> and <https://pubs.aeaweb.org/doi/pdfplus/10.1257/pol.20190086> (PDF)

4. <https://sanctum.geek.nz/presentations/a-brief-history-of-unix.pdf>

It is not the US but the Fanjul Brothers from Cuba who run the sugar cartel. And are major donors.

[..]The Fanjuls are most well-known for being sugar barons. Prior to fleeing Cuba and settling in Florida following Fidel Castro’s 1959 revolution, the family had, over generations, amassed a fortune through growing and marketing sugar. When they moved to the U.S. they kept this business tradition alive, and with great success: the family bought lands, planted sugar canes, built factories, created partnerships, and expanded to other countries. The Fanjuls own about 400,000 acres of sugar cane plantations, half of which are in Florida and the other half in the Dominican Republic. Their main sugar holding company is American Sugar Refining, Inc. (ASR), which is a partnership between the Fanjul family’s Florida Crystals and the Sugar Cane Growers Cooperative of Florida. American Sugar Refining controls refineries by ownership or shareholder status in four states and six countries. The company’s American brands include Domino, Florida Crystals, Redpath, Tate & Lyle, and C&H. [..]

https://www.promarket.org/2016/09/19/sugar-industry-buys-academia-politicians/?amp

There is actually more to this. It’s worth rabbitholing for Fanjul Brothers and the Cuban Sugar Cartel.

There is enough material here for an opulent political thriller K-drama stylesque series here.

Perhaps obvious was not a good choice. Anyways:

I would say Google is as close to a natural monopoly as the Bell System was in 1956. If you came to me and said “Hey, I want to start a company to compete with Google in search,” I would say you’re out of your mind and don’t waste your energy or your time or your money, there’s just no way. Classic economics would say that if there’s a business in which there are 35 percent net margins, that would attract a huge amount of new capital to capture some of that, and none of that has happened. That tells you there’s something wrong.

From: https://promarket.org/google-close-natural-monopoly-bell-system-1956/

Water companies are a utility because there's a high cost to laying the pipes and the more pipes you lay, the more people you service, the more pipes you can afford to lay. It's near impossible for an upstart water company to come in and displace the incumbent.

Search companies should be a utility because there's a high cost to gathering the data needed to drive good results and the more data you gather, the better results you give, the more data you gather. It's near impossible for an upstart search company to come in and displace the incumbent.

>> Just low[sic] how bootleg booze largely doesn't exist outside of prohibition since the market functions.

Tell me that you hang out with law abiding citizens without telling me...

Moonshine, home brew... people are out there sticking it too the man as much as they can.

If you have made home made cider, or beer, or yogurt, pickles, canned anything you know that its a labor but the product is better and far cheaper than what you can buy.

Convenience, quality, ease of use... People will pay a massive premium for these things. This (to this dismay of HN) is the Apple model. You can bleed the customer if they love you, if you have a good product.

This was a problem in early film, and the paramount decree was a thing: https://www.promarket.org/2022/12/12/the-paramount-decrees-and-the-deregulation-of-hollywood-studios/

One would think that this should apply to streaming services, but sadly no, they get treated like network television did (does).

And I know that one of you will glom on to the paramount decree as an argument for the iPhone App Store shenanigans of late. Sadly they aren't remotely close to each other Apple isnt restricting your timing, or telling you what your price should be.