For years I’ve read about the Federal Trade Commission accusing several tech companies of being monopolies. But why don’t they go after the cable companies? It seems like that is the biggest monopoly of all in most parts of the country, where you often only have 1 choice for internet.
In: Economics
Governments are allowed to create monopolies when it is in the public interest to do so. For things like utilities, it would be cost prohibitive for _every_ utility to develop completely separate infrastructure to every single home – we’d end up with either endless construction or no company seeing it as profitable enough to develop infrastructure at all.
To combat this, government will often allow a single utility be a government sanctioned monopoly so they make that infrastructure investment. This often comes with restrictions and stipulations on quality or cost of service (but not always).
So your cable company is an allowable monopoly because the government gives them permission to be one in order to get them to install the cable.
Tech companies are not utilities – there is no infrastructure investment to get Google search to your specific home – so there is no reason for the government to give them monopoly status.
Tech companies are often sued for being monopolies? When? 2001?
If you had 10 cable companies providing to your area, they’d all have to run their service through your entire area. It would cost them more PER customer which means your cost would be higher.
Since they are allowed to service all customers in the area, they can do so at a lower cost per customer and you save money. The government awards this leeway in exchange for them keeping costs affordable.
In an unchecked monopoly, they’d just raise prices because you have no other option.
A lot of companies have monopolies on things at any given time. Ie. if I have the patent on a new technology……I have a monopoly on that market. These companies get in trouble when they go around buying up all of their competition.
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