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Democracy & Technology Blog Google a “Monopolist”?

If more than 70% of all ad-supported queries flow through Google’s search engine, does that make Google a “monopolist” and a legitimate target of antitrust enforcement? Of course not. According to the late Professor Joseph Schumpeter, almost all monopolies are transitory, unless buttressed by public authority. Antitrust “remedies” typically ensure there will be no winners or losers among the commercial entities that currently inhabit a commercial ecosystem. And that can be deadly to investment and innovation.

In the real world, businesses have to navigate a minefield of of unforeseeable opportunities and challenges, such as shifting consumer preferences and new technologies. The Internet that Google appears to dominate in fact is a highly dynamic platform. Consider the following observation (Wired archive) by Chris Anderson from a provocative recent article in Wired,

Over the past few years, one of the most important shifts in the digital world has been the move from the wide-open Web to semiclosed platforms that use the Internet for transport but not the browser for display. It’s driven primarily by the rise of the iPhone model of mobile computing, and it’s a world Google can’t crawl, one where HTML doesn’t rule. And it’s the world that consumers are increasingly choosing, not because they’re rejecting the idea of the Web but because these dedicated platforms often just work better or fit better into their lives (the screen comes to them, they don’t have to go to the screen).

My colleague George Gilder has a slightly different take on this, but the point is a transformation is underway and not even the experts can agree what the future will look like.

Although Microsoft was also under intense competitive pressure, antitrust enforcers succumbed to political pressure and imposed severe limits on that company’s ability to innovate. Charles Rule, for one, believes antitrust enforcement should be consistent. But what happened to Microsoft was an injustice which should never be repeated. Two wrongs never make a right.

Hance Haney

Director and Senior Fellow of the Technology & Democracy Project
Hance Haney served as Director and Senior Fellow of the Technology & Democracy Project at the Discovery Institute, in Washington, D.C. Haney spent ten years as an aide to former Senator Bob Packwood (OR), and advised him in his capacity as chairman of the Senate Communications Subcommittee during the deliberations leading to the Telecommunications Act of 1996. He subsequently held various positions with the United States Telecom Association and Qwest Communications. He earned a B.A. in history from Willamette University and a J.D. from Lewis and Clark Law School in Portland, Oregon.