Saturday, March 13, 2010

Monopoly: A Definition

Merriam-Webter’s defines “Monopoly” as follows:

“exclusive ownership through legal privilege, command of supply, or concerted action”

Here’s why Microsoft, Adobe and Google are NOT monopolies:

  1. None of these companies rose to their positions of prominence as a direct or indirect of “legal privilege”.  Any laws they benefited from were applicable to all other companies of their industry .
  2. None of these companies exercised a “command of supply” in the sense that they control no entity or object which cannot be circumvented, or excluded.
  3. These companies did NOT control their rise to prominence as a result of “concerted action”.  They rose due to customer support.  Period.

Let’s face it: From PURELY FACTUAL STANDPOINT (rhetorical emotion aside) – Microsoft Windows has never been the only PC operating system.  Office has never been the only Office Productivity Suite (spreadsheet, word processor, etc.) available on the market.  In fact, there have many times been FREE alternatives.

At all times in the past 20 years, consumers, businesses and government entities have had the option of purchasing products by other vendors.  Apple Mac, Linux, UNIX, among others.  WordPerfect, OpenOffice, Star Office, etc.

Consumers, businesses and government entities CHOSE to buy these products.  And as a result of some of them establishing standard processes, others followed suit to remain “compatible” and reduce operational costs due to inefficiences.

The spirit of the laws which seek to prevent or remedy monopolistic practices is based on preventing any one entity from “unfairly gaining a dominance of their market”.  How is it unfair if they wound up in a dominant position as the result of consumers choosing them?

We put them where they are.

The term “monopoly” has been skewed into a completely incorrect definition in the minds of the media and the general public.

Let’s say that YOU decide to produce a software product and put it on the market.  Let’s also say that consumers go crazy over it and decide to snap it up like drinking water in the desert.  And let’s say over time none of your emerging competitors can manage to pull a significant share of your market away.  Maybe they suck.  Maybe they’re fighting internal corruption and ineptitude.  Whatever.  You end up being the dominant player in your market.  Now you are labeled a monopoly and must be punished.  This is how the law is interpreted today.

Did these companies abuse their ethical boundaries in the course of their growth? Sure.  Did they play unfair at times?  Yes.  Were they punished for it? Most certainly.  But were they EVER the ONLY option from which to choose?  Never.

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