Except what the bigger business will actually be providing is just selling a cheap copies of the same product on razor thin margins.
The end goal of business is not to serve customers. It's to create more share holder value. If you can do that best by serving customers then so be it. If you can do it better by dirty tactics then don't think people will think twice about doing so.
Ugh, Milton Friedman started perpetuating that particular falsehood around 1970 and now everyone believes it, so much so that they expect to get raped up the ass by big corporations.
Why do we have an economy? It's because ordinary people need goods and services. If we didn't, we could all stop working and stop buying things and live happily ever after. Most of us aren't shareholders in any significant way; if we actually believed that businesses existed to serve shareholders, let's get rid of them!
The reason company officers should act as if they're beholden to shareholder value is because there's no economic check on their resource consumption otherwise. It's easy to satisfy consumers: simply take lots of money from shareholders or the government, and give it to the people (a la AllAdvantage.com and several other dot-coms). But that's not economically efficient: there's no check on the resources consumed, so there's no incentive to be efficient, and you eventually run out of money. The profit motive ensures that businesses consume as little as possible and produce as much as possible, so as long as they act as if their goal is to maximize shareholder value, they maximize efficiency throughout the economy.
But over time, acting in the best interest of shareholders has been confused with the goal of the company is the best interest of shareholders. The former is an instrumental goal; the latter is an inherent one. And the inherent goal of corporations is not to maximize shareholder value, it's to provide useful goods and services as economically as possible. Google gets this; most other companies today do not.
Well, my statement is based on what the actual US law is (CEO's are required by law to increase share holder value) and actual experience working at large companies. Large companies are inherently inefficient, not more efficient. There are inefficiencies everywhere and "cost cutting" measures usually don't have any useful effect.
Your theory, like communism, etc., sounds good on paper but I've never seen it work as described.
I actually agree with the law, I'm making a statement about cause and effect, and inherent vs. instrumental values. The law that requires CEOs to increase shareholder value is valuable because it leads companies to satisfy customer desires in the most efficient way possible. If it didn't lead companies to satisfy customer desires efficiently, it should be eliminated.
The problematic part is when you get that causation mixed up and argue that because CEOs are required by law to increase shareholder value, the government should help them, eg. by protecting them from competition. Because customers are best served by robust competition between businesses. Shareholder-value laws, antitrust laws, and intellectual property laws are all tools for this purpose. Just because CEOs should maximize shareholder value doesn't mean that government should pass laws that make it easier for them to maximize shareholder value, particularly if those laws are at the expense of consumers.
(And I realize that points have sorta become twisted around, such that it now seems like I'm arguing against myself up-thread. It's complicated. Basically, government should enforce level playing fields - it should make sure that products compete on their own merits, and not on the basis of their success in other fields. Cross-subsidization, like what Google does on a massive scale, is a tricky area. It's wrong if the company uses it to enter a market, dominate, and then jack up prices. But it's fine if the company uses it to enter a market, dominate, and then keep prices low.)
The end goal of business is not to serve customers. It's to create more share holder value. If you can do that best by serving customers then so be it. If you can do it better by dirty tactics then don't think people will think twice about doing so.