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Oh? Let's pick an easy market to judge this against, then. I know! Let's talk about smartphones. Surely the largest company on the planet is a quasi-monopoly in this space... oh, but they're not. In fact, Apple's not even a majority leader in just the USA, and the numbers favor them even less globally. There is clearly a choice in the cell phone market between privacy, quality and cost, and people are making those choices.

Not to say that this isn't true right now in the search market. I grew up in a world where Google didn't exist, and the reason Google is so much more popular at search is because they're just that much better at delivering relevant results than everyone else. I used to search with Excite, Yahoo, Lycos, etc. and modernly I've TRIED to use Bing or DDG or whatever other choices have surfaced, but when the product seems free, people are going to make the choice that maximizes quality, and right now Google is just winning at it.

Still, if someone comes along who can actually deliver on the search quality then the market will change.




So, sure, let's talk about smartphones.

In 2010, there were quite a few smartphone platforms: iOS, Android, Blackberry, Symbian, WebOS, Windows (CE or Mobile or maybe both; can't remember when the switchover happened), Bada, probably some others I'm forgetting.

Between then and now, the story, aside from slight eddies such as the dismal failures that were Ubuntu Touch and FirefoxOS, has been one of platforms steadily exiting the market. So now we basically have just two options: Android and iOS.

And already I see people on HN occasionally predicting that iOS is doomed due to the fact that it has ~15% global marketshare, and Android has all the rest. I'm not sure if that's really true, but, regardless, the trend is still most certainly not toward a robust, competitive market with lots of consumer choice.


It depends on the market really. In some markets, there are strong effects where anybody but the market leader is at a super strongly disadvantageous position.

In the smartphone market this is not the case. You can buy from various SOC vendors, you can put Android onto your phone, you can do all of this while competing with other companies. There isn't much of an intrinsic benefit that e.g. Samsung has.

For search, it's different. Yes, you can crawl the entire web using crawlers, but what you don't get is data about which links people are clicking. It allows you to order the results in the right way. Google is paying hundreds of millions to Mozilla annually for the hundreds of millions of users that Firefox has. The reason for this is the clicking data. Not that Google needs the Firefox users any more, but any competitor would massively benefit from the amount of searches that they'd get from Firefox users alone.

Or take your classical communications network. Whatsapp, Facebook, etc. Here, network effects are the reason why there is such a strong monopoly. Nobody wants to join a network where they can't talk to anybody. So people join the popular ones like Whatsapp or Facebook.

There is a ton of money to make if you are in a monopoly position where you can't be kicked out and that's what most of the SV stories are about. They get VC to be able to get big enough to disrupt some market and become monopolist, hoping to stay monopolist due to network effects or similar mechanisms.


Fair points, also depressing ones.


Digital asset vs. tangible good differ significantly in the applicable market dynamics.


Where do you consume music then?


>Still, if someone comes along who can actually deliver on the search quality then the market will change.

Not really? We've already been here. We had multiple search engines of similar quality. Google came along as a superior product, and therefore raised superior money, and no one else could keep up. It's a zero-sum game in a lot of respects.

Even your smartphone example is zero-sum. Try to buy an Android device that doesn't use a Qualcomm chipset. Unless you go buy an Apple device you're just buying different configurations of the same hardware. Huawei has their own, but they aren't really even allowed to have a considerable market in the US.

The US kills competition. At best in a lot of regards you get two options. Even within the political system. If you don't have money you can't compete.




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