How do conglomerate corporations avoid anti-trust breakups in the US?
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There’s nothing inherently illegal about being a big conglomerate corporate, or being a trust…it’s how they behave that matters. Specifically, are they using their dominant market position to reduce competition.
Even a monster conglomerate like pre-breakup GE has plenty of competition in every business they operate in. As long as they don’t have enough market power to unfairly influence competition, they’re. At least with respect to anti-trust law.
Now that anti-trust law is a thing, large mergers have to go through government review and approval. It’s very hard to create a conglomerate with an over dominant market position now because the merger will get rejected. This happens fairly often, or they’ll allow the merger to proceed but force the conglomerate to spin off some portion to maintain competition.
Anti-trust laws are primarily in place to avoid monopolies, but especially in the tech industry this has become a grey area.
The key is not acting like a monopoly to control pricing and pushing out the competition.
ISPs for example will sometimes have a local monopoly but claim they have competition in the market because there is a different cable company in the town next door even though a particular customer doesn’t have access to them.
Having competition in a completely different region still means you have a monopoly in an area but the government doesn’t see it that way.
Tech giants like Microsoft have functional monopolies on software due to the popularity of their products but have enough minor competition to avoid further antitrust lawsuits.
The common excuse being: “our primary competitor is open source and therefore free, how do we compete with that?”
Microsoft actually invested in Apple at one point to help keep them afloat, probably to help keep their key and at the time minor competitor alive.
There’s nothing illegal about being a conglomerate, competing in many different markets. Most antitrust laws are about specific markets and the ability to negatively impact the market for that one product. Selling toothpaste and shampoo and dog food and baby formula isn’t an issue. It’s trying to buy up all the toothpaste brands and monopolize that one industry that is.
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