Unregulated markets do lead to monopoly. Why? Because it is the very nature of competition. There will be a winner (or a few) and most will either be acquired or they will die out. With monopoly comes political power and this leads to crony capitalism. Then the monopoly can now dictate prices and influence both legislation and government regulation. The idea that companies will compete in perpetuity and benefit consumers as a result is flawed. Competition will not last, someone will win.
I would be inclined to consider MS Windows had monopoly on market of desktop OS, and that particular market had little government oversight, essentially a free market. And Microsoft did what any rational monopolist would do, use it's monopoly power to stop spread of any other OS (by deals with OEM,etc), tried to enter other markets by use of monopoly, etc etc. Standard oil comes to my mind as another monopoly, but the market of petroleum was essentially not that free.
Now you may argue that the OS market was not technically free (as none has been in history of mankind), but I don't see any reason that why a better product would not gain monopoly in free market, and then, barring any restriction, why would the monopolist not (ab)use its power to maintain monopoly.
I don't see how Standard Oil was a monopoly, it only ever had at most 60% of the market. And even then, oil prices fell substantially during its reign so what's the problem?
Windows for all its market share, has still coexisted with Mac OS for decades. During that time computers have become more affordable, more prevalent, and more useful and having a dominant single platform seems to have been beneficial to many industries. So again, I don't see what the big problem is.
The only monopoly that seems genuine to me is (/was) DeBeers diamonds, although the fact they have no control over the sale of second hand diamonds makes me question its authenticity.
Can't we admit that monopolies are basically a myth? Why do people keep bringing them up as if there's numerous examples of monopoly abuse or monopoly-induced misery.
>> Can't we admit that monopolies are basically a myth? Why do people keep bringing them up as if there's numerous examples of monopoly abuse or monopoly-induced misery.
Exactly. The only monopolies that have ever existed in history are ones given monopoly privilege by government force.
Monopolies do exist, especially in developing countries. And they tend to control prices when no competition is around. The only reason why monopolies are no longer as dominant in the United States and the West is because of the outlawing of monopolistic practices like hoarding or selling products below costs to kill off smaller competitors. Again I don't deny that government involvement sustains monopolies but monopolies are first created by the free market, and then they kill that very free market that brought them to the top. I think we should do away with campaign contributions and go straight with public financing.
Well my point is that "free market" will destroy "free market". The idea is an unsustainable model because once a winner emerges politics gets involved. I do not deny the fact that government involvement can help sustain a monopoly, but my point is that the creation of a monopoly starts with the free market.
I'd argue otherwise, in any other case, but since a label's success solely depends on the success of its artists, which isn't always predictable, and considering the shrinking number of artists wishing to be signed onto a major label, there's a possibility of the music labels consolidating even more.
Then again, by the time they do, they just might stop mattering altogether. I keep hoping for self-implosion, anyhow.
I think the innovations in social media and file sharing will help artists become more independent and distribute their work directly to consumers. The trick is finding a way to monetize this efficiently and minimize the risk of people just getting it for free. Maybe adding advertising per download would be a viable option, I think there are some start-ups that are already doing that.
