But no, because Comcast has -bribed- donated to way more congresspeople than Google, because they’re better at playing that game.
Lobbying is tracked and google spent over 33% more than Comcast - in your own words - bribing members of Congress.
The bulk of Google’s lobbying expenditure was for immigration, tax reform and antitrust. I’d say Google’s far better “at playing the game” after all no one is randomly sticking up for Comcast.
> Not only was Google the pro-net neutrality organization that spent the most on lobbying in 2014 — $16.8 million in 2014 — it was the 10th biggest spender on federal lobbying that year. Impressive as that sounds, however, it still ranked behind both Comcast and the National Cable and Telecommunications Association.
And it seems like every dollar that Comcast spends lobbying is directed towards efforts that will have a negative impact on my life, and the lives of everyone not on Comcast's board of directors. At least with Google, sometimes our incentives align, so that's another point in favor of attempting to break up the Comcast monopoly before the Google one.
This isn't as uncontroversial of an opinion as it might appear to be in a place like HN. What you're admitting here basically is that you think Comcast should be broken up because they lobby for things you don't like, but FAANG is fine because they lobby for things you do.
> you think Comcast should be broken up
I think efforts to break up tech monopolies should first be focused on telecommunication companies.
> because they lobby for things you don't like,
Not just me, but are objectively harmful to 99% of the people they would affect
> but FAANG is fine because they lobby for things you do.
I'm mostly focusing on Google here, and yes, they at least occasionally lobby for things I like because sometimes their interests and the interests of the public in general happen to align.
With Comcast (and other ISPs), you have only one choice, and they spend tons of money and effort making sure you only have that one choice, and continue to have only that one choice. Comcast recently spent nearly $1M to prevent Fort Collins from creating a municipal ISP. That is actively anti-competitive and monopolistic by definition.
I'm sure if the U.S. government was proposing to sell public bonds to build a search engine or ride-sharing service, you'd see a lot of lobbying from Silicon Valley. It's not "actively anti-competitive and monopolistic by definition" to oppose government backed and funded competition in your industry.
Is it possible for them to have other strategic incentives for their action, such as preventing a type of competitor from emerging? Yes. And if you take the perspective that government is a uniquely troublesome competitor, it's understandable to feel extra strong about it.
But it's still monopolistic in context. A counterpoint to "competition from the government is uniquely unfair" is "having only one provider is uniquely unfair". One is from the perspective of a profitable $100B corporation, the other is from the perspective of the consumers.
The city wanted to launch a municipal internet service. Predictably, it failed because the requirements were to provide service everywhere and the bids all came back too high.
Meanwhile they continue to resist private ISPs who want to expand into neighborhoods where they think they can do so profitably.
Still I agree breaking up Comcast is not the solution. You will just end up with smaller more localized monopolies. That's pretty much what happened with Bell after all.
The solution would be either nationalizing the infrastructure and leasing it to operators or forcing existing operators to rent their infrastructure to their competitors for a set price. The later is actually working quite well in France. Short of that you will never get competition. It's simply not profitable.
Cost wise however, you can't even compare the USA and France. In France, a full speed FTTH subscription with no data cap cost 25 euros and you can pay 20 more to get a cell phone plan with unlimited call and unlimited data. If you are ready to switch provider yearly, you can bring that down to 25 euros all included.
And how quickly is France's number going to grow given that France's second largest ISP recently cancelled its plans to deploy fiber? https://www.reuters.com/article/altice-sfr-france/altice-aba....
Also note that the French deployment is being heavily subsidized by the government (to the tune of $24 billion). Except for a small amount during the post-2008 economic stimulus, broadband deployment in the U.S. is not subsidized. Whereas the French government is paying a direct subsidy to build fiber in rural areas, in the U.S. rural deployment is financed by a cross subsidy (taxing ISPs in urban areas to subsidize ISPs in rural ones).
Most likely unaffected. You rightfully pointed that the state is paying for much of it. A significant part of the deployment is actually done directly by the state (via the equivalent of counties) which owns the infrastructure.
> Also note that the French deployment is being heavily subsidized by the government (to the tune of $24 billion). Except for a small amount during the post-2008 economic stimulus, broadband deployment in the U.S. is not subsidized. Whereas the French government is paying a direct subsidy to build fiber in rural areas, in the U.S. rural deployment is financed by a cross subsidy (taxing ISPs in urban areas to subsidize ISPs in rural ones).
I don't really see what this has to do with my initial point: mandatory leasing of ISP private infrastructure to their competitors successfully create competition.
It is not subsidies to ISP by the way. Most of this money goes to counties so they can build their own infrastructure which they then lease to ISP. It makes a lot of sense because while this infrastructure wouldn't be profitable if privately built they have a significant positive economic impact on the region where they are deployed.
 When you build an income-producing capital asset like copper wire in the ground, you can’t deduct the cost from your revenues immediately for tax purposes, like you can with say employee salaries. Instead, you gradually deduct the capital cost over the income-producing life of the asset. If the government allowes you to depreciate an asset faster than the value of the asset actually drops, that nets you some tax benefit due to the time value of money. On the other hand, if the accelerated depreciation reflects the fact that certain types of assets depreciate quicker, then it will result in the correct amount of taxes being paid. For example IT equipment in data centers can generally be written off immediately—unlike wires in the the ground it’s pretty much worthless after a few years.
The 'cost vs. benefit' analysis should reveal similar ROI as "the wall."
What's the purpose of monopoly laws? What is their spirit? Consumer benefit, right? If that is better served by municipal utilities, then while it may not violate the word of antitrust, it certainly violates the spirit.
There’s definitely an argument to be made here that their interests don’t align with the public, and that they should therefore be targeted first — public interests is a subjective phrase.
Perhaps outright defending FANG is going too far, but the parent definitely has a point that ISP's should be looked into when we're discussing "breaking up" companies.
I don't think that you could get any reasonably representative range of economists in a room to even agree that this is ever a better option, so I think your claim to objectivity is unwarranted.
Far from being a shocking "admission," it's the least surprising thing in the world that people support policy they like and oppose policy they don't. And ignore policy they're indifferent to.
(People may also at times support policy they don't like and oppose policy they do for various practical political reasons, but that's a different discussion.)
This might be more of an issue in areas where things people do/don't like are arbitrary matters of taste. I'm certainly not saddling up to lead a state-backed charge against the company that produces Peeps despite the fact that I think they're a terrible excuse for candy.
But net neutrality is not an arbitrary matter of taste.
Nor, really, are immigration, tax reform and antitrust issues.
The original point of anti-trust law was to make things better for the consumer. If Comcast is using their power to lobby for anti-consumer practices then they should be broken up. Naturally consumers are going to disagree with anti-consumer practices.
But the point is well made. We can't be breaking up companies that don't do what we want, if they're playing by the rules.
The real answer is to change the rules. Warren is running on some populist anger, and that's a dangerous thing to praise.
The government running an entire industry, even the threat of such a thing, is a great way to completely destroy innovation in that industry. Why would I invest in research if it's a real possibility the government can come in and take everything from me for nothing?
What you're suggesting doesn't create a free market, it creates a dead market.
Additionally, and far more importantly: Comcast is a regional monopoly. They have a lot of power in some geographic areas of the United States. Google is a global monopoly that has power in nearly every home on the planet. You shouldn't be willing to strengthen a global monopoly to try to fight a regional one.
And Google is far more than just where you go to search or store your email. Somewhere around 90% of the web uses Google Analytics, Google Ads, or Google Fonts, so they can track you regardless of where you go online. And that's before you get into the fact that plenty of websites are on Google's cloud services, which you may not even know. (I left Google Docs for another service, for instance, but it's still hosted on Google's servers.) Even if you're not logged into a Google account, Google is tracking you and profiling your behavior across the web. (Google also collects credit card data, so they can track you in brick and mortar stores now too.)
Using Google's browser to access the web is also becoming increasingly inescapable, now that the company with the second largest market share in web browsers is switching to Chrome's codebase. Firefox is nearly the last remaining holdout against Chromium. In fact, the very protocol we use to talk to the web is constantly being revised primarily on Google's lead and direction. HTTP/3, QUIC, DNS-over-HTTPS, etc. is all about moving the web's standard to something more palatable to Google's business models, and making them harder to block or filter out.
It's incredibly naive to believe you can escape Google. I've spent years de-Googling, and there's plenty of data Google still has on me.
ISP monopolies are a big problem, but they won't follow you when you move. A high bar for escape, to be sure, but escaping Google likely requires an even higher bar: Entering the witness protection program and getting a new identity.
And the reason they don't have more market share is because Chrome is still faster and provides a better experience on average than Firefox does. I switched (back) to Firefox a few years ago, and I'm mostly happy with it. But when I try to get others to switch, those that end up not switching try for a few days and run into horrible performance issues that cripple their browsing experience. Clearly this isn't a universal issue (my experience is fine), but it's a big enough issue that it likely hampers further adoption.
I pretty much never hear "Firefox doesn't work properly on X site" as a reason they can't use Firefox. In the end, people use Chrome because it tends to give a better experience for people, even given its lack of respect for their privacy.
Without net neutrality, ISPs would be free to charge big players like Google and Netflix more money, and that would leave a lot more room for smaller players to get involved. Getting "the same terms" as Google and Netflix is not always, inherently, a good thing.
When ISPs decide that they should charge more for all video traffic, the smaller companies can't pay it but the larger ones can. Why would the ISPs act in the benefit of small companies when they can make more by charging more for all streaming video.
That seems suspect to me...
You pay your bribes or the justice department comes knocking. Google made antitrust investigations just vanish into thin air.
That's just members of Congress. What about local governments? Keep in mind a lot of states don't have laws that require publicly disclosing lobbying efforts.
Or you can un-ironically google “google lobbying” and find more detailed articles about Google’s lobbying published by time, fortune, Bloomberg, etc...
His statement still holds
Probably because they saw what happened when Microsoft tried to ignore Washington, DC. altogether. Can you blame Google for realizing that they couldn't just turn their backs on the game?
That said, I'm in favor of the former. Citizens United has been a pox on representatives representing their constituents, which has made lobbying all the more effective and easy.
To be fair, I think there is some argument that some of the larger tech giants would benefit consumer welfare by being broken up. Facebook probably less so since people already have choice.
Warren does herself no favors by using $25 billion as the threshold of a monopoly. What a real monopoly is is when there is no consumer choice at all, leading to large corporate profits that hurt consumers at the pricing level.
By not using consumer choice or harm as the standard (which is what the court uses), Warren comes across (and perhaps actually intends) to be against large companies, regardless of welfare.
Instead of focusing on consumer welfare, antitrust law should focus on 'anticompetitive behavior'. In this argument, amazon is the platform through which all other online sellers go to market, like railroads in the late 19th century. Behaving as both a platform and participant is anticompetitive, regardless of whether programs like 'amazon basics' make consumers happy.
NYT article about the author of the original law paper https://www.nytimes.com/2018/09/07/technology/monopoly-antit...
I don't have strong feelings on the issue, but this may help explain warren's stance, which isn't directly related to consumer choice.
I Don't agree with this view. It surely has the potential to hurt the consumers in the future but IF and WHEN it does consumer impact at that time can be used to fight it (break up etc). No need to actually hurt the consumer NOW for the fear that they might be hurt in the future.
The way that the 'consumer welfare' protection is currently implemented has no teeth.
Consider the Comcast/TWC mergers. The companies involved pay 'experts' (Of their choice) to spin fairy tales about how they project that costs to customers will go down. Five years down the road, when they don't (Or, customers suffer because other intangibles degrade, due to lack of competition), nobody actually holds them accountable, after the fact.
Well, sure, 100% national market share is obviously a monopoly. But you're also a monopoly if you distort a market (generally markets with less than 3 major players) or have control or distortion over individual markets (you can have a monopoly in NYC but not the US, for example).
I think this obviously applies to telecoms, which often have monopolies over certain areas (and often granted by local government! thanks a lot Philly city council).
I think there's a whole host of bad behavior that's non-monopolistic. That's what I think needs to be cracked down on. Some of these do relate to market share, but I don't think it's as simple as a boolean monopoly / not-monopoly. It's a gradient, and much of the behavior in that gradient should be dealt with. There's often collusion between companies on pricing, or agreements not to compete, etc...
That's a key distinction. Are there any actual monopolies (I don't mean companies that are merely dominant) that are not backed by government?
Let's clear up what we're talking about. I don't find monopolies to be a very interesting subject.
What I have a problem with is anticompetitive behavior (which is illegal but the US has been notably slacking on enforcement for years). When a company uses their position as a platform for sales to start pushing into selling actual products in markets they've determined to be profitable, or a company bundles their applications with their mobile platform thereby dominating the app market, or when a company runs the largest platform for search but simultaneously distorts it through advertising and mysterious delisting or account shutdowns, then you have problems. These companies are anti-competitively distorting markets in ways that consumers can't understand and requires regulation.
There are two ways tech companies are often uncompetitive. Predatory or below cost-pricing, https://www.ftc.gov/tips-advice/competition-guidance/guide-a... is first among them. Think Uber, where they lose money each ride. "Free" services also seem like they violate this, as they prevent anyone from competing in that market. You can't sell private email services so long as free email exists. App and service bundling falls under the other condition, https://www.ftc.gov/tips-advice/competition-guidance/guide-a.... Mysterious delisting or shutting down accounts without reason or recourse falls under refusal to deal, https://www.ftc.gov/tips-advice/competition-guidance/guide-a....
It's only kinda choice. They have such a dominance over the social graph, most people who "leave" them don't actually completely leave. Most of them keep Facebook around as an address-book+messaging. People who "leave" by actually deleting their account then turn around and create obvious dummy accounts.
It was the political appointees (from both parties) who shut the investigation down.
>The Federal Trade Commission on Thursday faced renewed questions about its handling of its antitrust investigation into Google, after documents revealed that an internal report had recommended stronger action.
The 2012 report, from the agency’s bureau of competition, said that the agency should sue the Internet search company for anticompetitive practices…
In early 2013, the agency unanimously voted not to bring charges after an investigation.
Google's lobbying investment levels appear to have been quite adequate.
However, I would agree that the telecomm companies are also ripe for antitrust action.
God knows I’d trust her to break up ISPs before pretty much any other candidate.
2016, but still..
Is this true? It depends on your use of the internet and definitions of “worse”, but I know that both Google and Facebook have been strong opponents of state-level Internet privacy legislation. They also spend huge amounts on lobbying, SV outspending Wall Street about 2:1 for the last few years. Do telcos spend more?
> "Google said it lobbied on dozens of issues, reflecting how integral its services have become to American lives and commerce. The filing cited privacy, data security, antitrust, taxes, tariffs, trade, the opioid crisis, artificial intelligence, cloud computing, autonomous vehicles, immigration, the future of work, encryption and national security."
It's not really that surprising, because they're not only affected by it but on multiple fronts.
There was a time when Google spent hardly anything on lobbying. Meanwhile Hollywood was promoting things like SOPA, Microsoft was at one point operating a major anti-Google lobbying campaign, ISPs want to violate network neutrality, etc.
It's one thing to not want to fight, something else to not respond when provoked.
I also think that Warren is dead wrong. The internet/FB/GOOGL allow smaller businesses to flourish. 15 years ago, only major brands could afford to advertise or reach an audience, now niche companies can exist with a national or international presence.
If anything, these tech monopolies hurt the previously established, Coke/Kraft/Sears and they hurt VC's who can't find a way to scale a niche brand with smaller TAM's or compete directly with Amazon, etc.
Is that true?  indicates Google spent more than Comcast in lobbying in q1 2015. I have no idea how this varies quarter by quarter and since 2015, but Google spends a lot lobbying.
I would not be surprised if that extends to campaign contributions as well. Google donates a ton of money to a ton of politicians.
I figured people would take a couple minutes to
educate themselves about the candidates, but I forgot that I wasn't in my home country.
Is there a candidate that has done more than Warren in this regard? (not criticizing, I'm legitimately curious)
And if we take a step back: this isn't necessarily only about privacy, but about capitalism and competition. Data-miner customers, and data-miner subjects might both get a better deal if there were competition between the middle men, at least more than now.
Verizon and Comcast could play the same game, but they're still more about money than influence - which is why they've chosen to make their stand on killing net neutrality, not on influencing referendums and elections.
FB particularly is incredibly toxic to genuine democracy - not necessarily more toxic than some of the other monsters in the mainstream media shark tank, but certainly not a company that should be allowed to run riot without oversight.
Paying $110/month for a business line with 50 down / 10 up, while recently i was offered then refused a promotion upgrade to $140/month with 150 down / 25 up for 3 years. After three years, the pricing goes close $300. Unbelievable deceiving offerings for reduction in current pricing. Totally stuck... :(
It seemed have helped in the Ma Bell days.
 - https://en.wikipedia.org/wiki/Bell_System
 - https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System
The general premise is that the smaller companies allows competition to enter the market. It is precisely because of this competition that the smaller bells all failed - because they were still stuck in the mentality that they needn't compete, whilst also lacking the resources to drive the competition out of town (e.g.: lobbying, buy them out, etc.). They didn't control the whole chain, anymore.
That's supposed to be the idyllic of the capitalist system, yeah?
I'm genuinely not trying to be contrarian, here, but trying to understand how breaking up a monopoly, such as Bell, didn't have any direct consequences on the territorial monopolies.
For example, if Bell had an agreement with 'x' area that they were the sole provider in that area, then as soon as they were no longer Bell, that monopoly agreement essentially hit dissolution, yeah? In principle, that should have an almost immediate net-positive effect on the area, I would think?
They did drive out the competition. The Baby Bells inherited the existing infrastructure. Most competing carriers relied on regulations that allowed them to lease access at wholesale rates. The Baby Bells got those regulations overturned. Investors weren't lining up to fund duplicate infrastructure anyway but especially not when the Baby Bells could tie up any project in court for months or years.
Dividing a national monopoly into regional monopolies did almost nothing to improve competition. Vertical disintegration did while it lasted.
The only companies that really managed to compete with the Baby Bells were cable companies, which had built out infrastructure before they started competing.
We had 27 large banks in the early 90's. These have merged into four enormous ones today .
We had 50 media corporations in the early 80's. They have merged into six today .
Haha, the actual "but no, because" is that Comcast and Verizon said "why not the platforms first" in response to net neutrality.
Regulating one of these industries isn't at all in any way whatsoever in a first-second relationship with doing the same to the other industry.
I recall Google having the highest expenditure on lobbying for one of the last few years.
The point about Comcast's anticompetitive practices still holds, but not as a "they do this worse than them" IMO.
The best solution is probably to accept the national monopoly and socialise the infrastructure, but like that will ever happen...
The average person will have an easier time understanding the concept that his favorite pundit is less discoverable on Google properties than his political opponent than the concept that Comcast owns Sky, MSNBC, Rotten Tomatoes, Universal Pictures, Telemundo, E!, Vox, The Verge and has all manners of pervasive influence in your thought.
Ads are worthless on their own.
In tech, the trend has been in the other direction. If you don’t consider Sprint a viable competitor to AT&T, what does that say about Bing and the search market? If cellular isn’t competitive, what about mobile, where there is just Android and iOS?
Sure, Google has the search monopoly, but they don't actively squash (or try to get laws made against) any other company trying to build an alternative search engine. I use DDG for most things, but occasionally have to repeat the search on Google because its just better.
Also, my point isn't that FAANG are perfect citizens and don't need any regulation at all, its that the Telecom companies are far worse If we're gearing up enough citizenry outrage to do some monopoly busting, lets start with them instead.
In the past decade I've lived in three different cities, and in each one Comcast was the only provider available. Do we really not think Comcast has a monopoly?
If you take the view that cellular or DSL aren't legitimate competition (despite having double-digit marketshare even where Comcast has no other competition), then Bing and Yahoo! aren't competition for Google either. In which case Google has a nationwide monopoly in search.
Actually, many economists - and perhaps most of them - argue that what's fundamental to monopolization concerns is the presence of undue barriers to entry that make the market non-contestable. "Market share" and "choice" are not helpful on their own, because a big market share could be entirely due to the incumbent pursuing efficiency and the consumer's best interests, so as to keep themselves ahead of any possible competitors. But this is a benign dynamic that will be quickly corrected should the incumbent fall behind, as competitors would quickly enter the market.
I'm not in SV, but this is 100% not true in my area. Where I live, my choice for broadband providers consists of Comcast. There is no alternative, nor is there any sign that competition is coming.
Only that you don't need an agreement to make it happen. Tacit understanding works just as well.
And phone service is not a viable alternative. Even 50gb (the standard cap it seems nowadays before throttling) gets you only 10-20 hours of video at high quality.
As to cellular—it’s a viable alternative for lots of people. Many people don’t need more than 10-20 hours of high quality video per month. 20% of people are already smartphone-only users, and that figure is growing. At the same time, those data caps are growing. Verizon’s 5G service has no data cap. Even if there is a soft cap of a few hundred GB, that’ll be a viable wired replacement for most people.
The trend in tech, by contrast, is the opposite. We’re not on the precipice of increased competition in search or mobile OSs. Indeed, with Microsoft throwing in the towel on Windows Mobile, there is less competition in that space than ever.
I don’t see how splitting up Apple or Google would increase the number of mobile OSs. There have been companies in the past that have tried building a mobile OS either for a specific phone or as an open source OS and none of them have really gained traction. There have been rumors for a couple years now of some of the phone manufacturers talking about building their own OS to use in place of android, yet those still haven’t appeared. Microsoft failed at mobile because they were too late to the party, people already knew which mobile experience they preferred.
That's not true, and I'm not sure where people get that idea. Slightly over half the country has two or more wired choices at 25 mbps, and that's as of a few years ago.
And if you're saying that texting my aunt in Bangladesh is a viable alternative to sharing pictures of my kids on Facebook, then it makes no sense to discount satellite, DSL, and cellular as viable alternatives to Comcast. (And indeed they are for many people--just over half the households in Comcast's footprint actually subscribe to its service.)
She doesn't really care about the underlying cause. If that was so then your points would be valid.
But look at how many news articles got published and how many people are getting excited about the thought. Being against successful technology companies is currently what liberals want and she's feeding her party.
She's been calling out large companies for her whole political career, motivated by the inequity she saw in her previous career in bankruptcy law.
You can not change your cable provider in a large number of areas, and even many of the ones that you can, you only have 2 choices between Comcast/Verizon/ATT/Centurylink.
And, miraculously, as soon as a competitor arrives, you see prices drop and speeds increase. It happened in just about every area Google fiber rolled out to.
Comcast also charge $10 for an extra 50GB of data after hitting the cap, and Comcast just happens to own a major network (which if you stream your tv shows, you won't be watching). It just seems incredibly clear that Comcast and other cable companies are clearly taking advantage of their monopoly status at the expense of customers, which is exactly when trust busting is supposed to come into play.
This is largely false: look at market share of all their competitors — network effects are really hard to replace.
Facebook is harder to replace, but people thought Myspace would be around forever for the same reasons.
Even if Comcast et al. get broken up, we'll probably just end up with poor customer service from the resultant components until they merge.
That's like asking the government to break up the react framework because more sites are using it and you have no jquery option.
Not really — my option is basically "indirectly support AWS" or "forego large swaths of the Internet." Site owners have to choose between directly supporting AWS, indirectly supporting AWS via intermediary services that use it, or giving up the economies of scale that AWS's dominance allows.
> That's like asking the government to break up the react framework because more sites are using it and you have no jquery option.
This is not analogous. AWS is a company. React is an open source project.
Paying $110/month for a business line with 50 down / 10 up, while recently i was offered then refused a promotion upgrade to $140/month with 150 down / 25 up for 3 years. After three years, the pricing goes close $300.
Quite deceiving pushy sales people and their offerings with reduction in current pricing. I am considered a loyal grandfathered customer, yet i am totally stuck... :(
An antitrust breakup of Comcast would be one or both of:
1. splitting off different lines of business, such as the content production parts from the physical cable service part, or
2. splitting them into different companies geographically.
Neither of these would do much to increase your ISP options.
The first one works if you do it properly. One of the lines of business just operates the physical infrastructure. It not only doesn't provide video service, it doesn't even provide internet service -- the end user is never their customer, their only customers are third party ISPs, who all get the same terms.
The physical infrastructure is what makes everything on top of it possible, and at the same time it is one of the most expensive pieces to build, upgrade, and maintain. There needs to be adequate returns on investment in the infrastructure, and that's hard to do in the unbundled model.
If you want high-quality infrastructure, you need to let the infrastructure builder capture a sufficient portion of the value created by that infrastructure. Consider trains. Trains create value for people using the train to get around, but also value for the real estate by the train station. If you only let the train company recover from the rider, you won't incentives that reflect the true value of investing in the train.
Look at Japan, where train service is exceptional. The train company gets to charge both sides. They charge fares to riders, but also are major land owners around train stations, and charge rent to the businesses who benefit from having train service near them. If you had your model in Japan, where train companies just own the tracks and get a modest fee for allowing people to use them, you would not see that kind of high-quality train service.
Why is it hard? You charge a price that reflects the cost of building the infrastructure. 200Mbps service can have a higher price than 50Mbps service, providing an incentive to build the capacity necessary to offer it. Which is still true even if the price for the faster service falls to approach the price for the slower service as upgrade cost is paid off. And then there is another upgrade and 1000Mbps service becomes the more expensive one compared to the now more affordable 200Mbps etc.
> Consider trains. Trains create value for people using the train to get around, but also value for the real estate by the train station. If you only let the train company recover from the rider, you won't incentives that reflect the true value of investing in the train.
You're essentially arguing against there being efficient Coasian bargaining. But the arguments against it are usually related to transaction costs, which don't seem to help you here. If Comcast can't charge anything to Netflix and as a result Netflix service is slightly less expensive to the user and internet service is slightly more expensive to the user, the user is not engaging in any new transactions and the net to the user is approximately zero. Moreover, then there is no transaction happening between Comcast and Netflix, which reduces the overall number of transactions that have to occur.
The situation right now is so ridiculous that some states have laws outright barring municipal ISPs. If a breakup into regional private monopolies is the stepping stone to reducing ISP influence on government enough to get a more sane legal framework, I'll take it.
In Canada, there's a bunch of smaller cable resellers. For instance, Shaw does cable/phone/tv and also has some wifi infrastructure deals with various commercial businesses, and provides "Shaw Go Wifi" access to internet subscribers.
In my local area, we also have LightSpeed which resells access to Shaw for a cheaper rate, but you need to buy your own modem, and there's no wifi access around town. Trade-offs, and a slightly more healthy marketplace.
These monolithic companies are sucking up all of the power in our economy and have destroyed the competitive markets. As the Economist recently said "Profits are too high. America needs a giant dose of competition." https://www.economist.com/briefing/2016/03/26/too-much-of-a-...
Capitalism without competition isn't really capitalism, but feudalism.
Regarding trust busting, it is worth noting that these tech giants give an immense amount of money and support to the left. Might as well give Warren some bipartisan support so we can thrash them a bit---it would be sweet poetic justice to attack these statist zealots with the very government power they worship.
They should be broken up.
Enthusiasm: Telco cartels need more oversight, make them government run, so they are beholden to the people. They serve themselves at a nice profit at everyone's expense, but internet communications have become so intertwined in culture, commerce, national security, that there really is no reason they shouldn't be part of the government apparatus.
Sarcasm: Government run telcos will cost taxpayers even more money, work worse than they do now, and increase government pensions to be payed out. US Internet will stagnate as a result of people getting into telco as a cushy government position.
Those companies are Boeing Aircraft (153k employees, $244B market value), United Technologies (202k employees, $148B market value), and United Airlines (88k employees, $33B market value).
What most people perceive as a threat to the market is when one company takes over an entire single market. And that is a problem, no doubt. But in the case of Boeing, the problem was that one company had such an advantage vertically- lose money on planes in order to make money on shipping, or vice versa, as needed. It meant it could win in whichever market it wanted to and slowly come to dominate all of those markets. The synergies of doing it all internally meant it could win at everything.
If one uses that situation as a precedent, one can start to see the parallels in many of the FAANG companies today.
 "The Air Mail Act of 1934 prohibited airlines and manufacturers from being under the same corporate umbrella, so the company split into three smaller companies – Boeing Airplane Company, United Airlines, and United Aircraft Corporation, the precursor to United Technologies." https://en.wikipedia.org/wiki/Boeing
The problem of Amazon is that it is effectively the only online shopping place, and thus can act as a Monopsony in hiring it's workers for warehouses, splitting AWS out of that doesn't fix that problem. Maybe you could require that distribution centers be owned by separate companies. This might work but locally each Center would still be a Monopsony and thus cause the same problem. Maybe if you capped the size of distribution center you could force lots of smaller ones to be built, but at this point I worry that you are going to end up making shipping slower and more expensive.
The problem of Google is they are very dominate in the Ads space splitting out the Ads portion into another company would not solve that. Facebook's problems is everyone has put their data in Facebook has friends in Facebook and feel compelled to keep using it. I don't see how splitting up the company into, Instagram, What's App, and Facebook solves the network effects of those apps.
Splitting up tech companies is not a punishment to make the CEO feel bad or change their ways. It is a technique to change how we need the market works to benefit the large population. As such we need to think about how to split them, the effects, and most importantly if the effect achieves the intended result.
You want to build a trillion dollar company? Fine. Corporate tax rate of 50%. You're a small business with less than $1M in revenue. Cool. Corporate tax rate of 0%.
Big companies will break up to take advantage of the tax code. Problem solved.
Instead, the bigger you are, the harder you can lobby for tax breaks. Currently, if you're a $1M company, that sucks. You pay 20%+. If you're Amazon, you pay $0.
A progressive corporate tax still makes some sense, and there's basically no excuse for their taxes being less simple than a citizen's. However active management is still required. Markets are fast and efficient but they are often dumb.
In what market are they a monopoly? Seriously. Amazon retail competes with walmart and target both of which offer online sales and AWS competes heavily with Azure and Google cloud. In what way is Amazon a monopoly?
The point is: you can give big companies whatever rate you want, but they're in the strongest position to circumvent it, and they will. The better choice is to lower taxes substantially and give the smaller companies a chance to accumulate capital faster, so they can compete.
But we could simplify the tax code... The bigger the surface area, the easier it is to find a vulnerability / loophole. And anymore, the tax code is basically being written by BigCos to protect their interests and provide breaks for themselves.
Enforcing a tax code that's 20-feet tall when printed out when companies are as complicated as they are -- it's a wonder anyone pays taxes. It would take years in court to figure out what a company honestly owes.
If it's simple -- you make x profit or y revenue -- then you pay z dollars -- for any public company, good luck grossly cheating that.
An essential point any plan like the GP's would be to make conduct like you describe illegal, and make sure those laws are adequately enforced and have enough teeth to be a deterrent.
Changing tax rates don't fix either of those.
Sales/Use/VAT tax for payments to wholly owned subsidiaries.
Large companies are perceived as being proportionally beneficial to the US economy. If you made the US a place that was meaningfully undesirable for corporations, they can leave. And even if these companies did not leave, you would strongly deter new companies. For instance imagine you were able to create your system such that it could not be simply avoided through various typical methods. So big companies really did risk losing up to 50% of their net. How long would it take before e.g. YCombinator started requiring new companies to incorporate in e.g. Hong Kong (or wherever) instead of the US? Perhaps even moving the entire operation abroad.
So even though I think this would be an absolutely incredible idea, I do not think it would work or be meaningfully considered in practice.
Here's an article about 2016:
US citizens can't avoid worldwide taxation, but they certainly move states to avoid taxes.
What exactly is that intended result?
I'm not critical to the idea nor supportive - I'm just curious to learn more.
Also, those guys meeting up together at Rockefeller's house to coordinate would likely be illegal today and probably was back then too.
By this logic Apple shouldnt be allowed to have Apps in its App store, right? Or are they banned from selling first and third party phone cases in store?
CVS shouldnt be allowed its own generic drugs.
At what point does this become "companies arent allowed to make/sell their own products if they also resell other companies products."
And lets be serious: you want to take away Google's ability to choose the ranking of results? Thats their entire company's purpose. People go to google because they like the order the results come in. If google starts delivering bad results, that opens opportunity for other companies.
This is just the first step in a new conversation about confronting monopoly in America. There hasn't been a bill written yet.
Amazon is a marketplace meaning the seller takes on all of the risk and pays Amazon for the privilege. Amazon then uses the data that marketplace generates to undercut the sellers with their private labels.
For instance, Apple makes hardware, software, services and they all fit together perfectly. Tesla distributes cars in addition to making them, leading to a better buying experience.
Everything Amazon does is in-line with this principle as well.
Is the end game laws similar to what we have for alcoholic beverages and cars? Where distribution and manufacturing are artificially separated?
Companies with an annual global revenue of $25 billion or more and that offer to the public an online marketplace, an exchange, or a platform for connecting third parties would be designated as "platform utilities." … These companies would be prohibited from owning both the platform utility and any participants on that platform.
Thus Safeway would be exempt from the regulation because (a) they do not offer an online marketplace and (b) they do not connect third parties (but instead act as an intermediary).
Similarly, it appears that only Amazon Marketplace, not the retail arm of Amazon, would be affected by this regulation.
You’d think we would hear more about it since basically every physical retailer owns their own brands that they sell in their own marketplaces already.
> ... legislation that requires large tech platforms to be designated as “Platform Utilities” and broken apart from any participant on that platform.
Companies with an annual global revenue of $25 billion or more and that offer to the public an online marketplace, an exchange, or a platform for connecting third parties would be designated as “platform utilities.”
These companies would be prohibited from owning both the platform utility and any participants on that platform. Platform utilities would be required to meet a standard of fair, reasonable, and nondiscriminatory dealing with users. Platform utilities would not be allowed to transfer or share data with third parties.
Nations that decide to close down in certain areas, may find themselves in a competitive disadvantage to peers making use of data, economies of scale, technology, labour, etc. This is something we have seen happen in history.
It also doesn't help that there seems to be academic corruption or at least conflicts of interest driving the new interpretation.
It was back in 2001 that I remember reading a newspaper article on this
However as long as the companies are well regulated and publicly traded, I think the concern diminishes over time. Each manager has an incentive to look out for their own shareholders, their own bonuses. And if activist shareholders suspect one company is subsidizing another, they can happily buy the undervalued company, raise a ruckus (and maybe some lawsuits), and profit when the subsidies end.