Anti-trust for an industry where there are at least five companies doing well in any given space? That's not called a monopoly, it's called competition.
Edit: I wasn't accusing everyone who is critical of tech of being a Luddite. The attitude that nearly every tech company is a net negative for society goes quite a bit beyond criticism.
Where does the article mention barriers to entry? My reading is that that the consolidation is due to venture capital moving investment to other areas. Anyone who wants to start a new food delivery app is still free to do so, as long as they can find funding.
This is the definition of competition according to Wikipedia: "Competition is a scenario where different economic firms are in contention to obtain goods that are limited by varying the elements of the marketing mix: price, product, promotion and place."
Yes, sounds like competition to me. Network effects are not anti-competitive.
> Anyone who wants to start a new food delivery app is still free to do so, as long as they can find funding.
This argument is meaningless because you can always make it. There's a quasi-monopoly? Yeah but you're still allowed to make a new company so it's not really a problem is it? You'll fail, unless you're backed by even more powerful venture capital, but I don't care about that because I get to keep making the argument that it's a free market.
The reality is that the only way you can compete in this market is to already be a billion dollar company, or have the backing of one. That's not a free market by any reasonable definition.
> Anti-trust for an industry where there are at least five companies doing well in any given space? That's not called a monopoly, it's called competition
You need to be completely out of touch with reality to read an article on 5 companies dominating a global market and your take from that info is that there are no anticompetitive practices because 5 is more than 1.
In the IO literature it would be expected that five companies of vaguely similar size in oligopolistic competition (say Cournot competition for simplicity) would be pretty close to the equilibrium of a perfectly competitive market.
I don't think that simply the ability to perform a task is sufficient for competition. It could still be impossible for a newcomer to compete with established corps' marketing budget and economies of scale.
The point is who cares. Getting a burrito delivered is a pointless luxury service that no one actually needs. Instead of complaining about competition, just stop wasting money on it.
You don't care. That's fine. It's not like there is a retirement to be informed before commenting. Sit this one out and let everyone who do express their concerns.
If five companies competing is anti-competitive, then how many competitors does it take to suddenly become competitive and why? What is the significance of this larger-than-five number? Is it the same across industries? How do you derive it?
This seems to rest on the mistaken belief that a corollary of monopolies being bad is that more competition is always better than less competition. If everyone was a competitor in the restaurant food delivery market we'd all starve to death as no one would be growing food. An efficient economy wouldn't waste resources competing over less important things like restaurant food delivery over something more beneficial.
Perhaps the issue isn't whether there is a specific number of companies. It seems to me that there is a competition problem when companies behave in a way that is harmful/disliked/bad but no one steps in to provide an alternative because they can't compete with established marketing, economies of scale, network effects, etc.
"completely out of touch" is definitely an exaggregationg. Besides, as if competition would really increase quality. Where I dwell, we have around 3 active delivery services. Only 1 of them has an app with useable UX, icnluding accessibility. Competition? Meh. What for? So that I can watch the smaller guys blunder their way to the top?
> "completely out of touch" is definitely an exaggregationg.
Is it, though? I mean, can you present a coherent argument supporting the idea that a global market being dominated by 5 multinational corporations does not flag a risk of anticompetitive practices?
> Competition? Meh. What for? So that I can watch the smaller guys blunder their way to the top?
Is this what you have to offer to refute the idea you're completely out of touch?
If by "coherent" you mean the Webster definition then yeah, anyone can.
If by coherent you mean "using only facts and opinions that I accept at face value within my world view" then no.
Personally, I think 5 is way too little. But there are probably some markets for various products and services where 5 is fine. I don't think the number matters so much as that there be potential for a long tail of upstarts who could potentially displace a big player quickly. Whether 95% of the market is captured 2 or 22 players doesn't matter, they gotta know that someone is waiting to take their place if they screw up.
Now imagine you live in one of the other 190 countries of the world who do not or no longer have significant players in the industry because they were crushed by those five foreign companies. It's not competition when the wealth and power is so disproportionately held by the same people in the same places.
China (basically) only has didi. Not much the USA can say here.
Southeast has Grab, and within each country there are at least 2 local competitors (Be, GoJek, Bolt, Line Man, Bluebird, etc). I believe Doordash just bought Deliveroo, making it the only American competitor in SEA.
In Europe, the main players are local food panda / Delivery hero and Just Eat.
India's winning food delivery is Swiggy.
What countries have both the talent to build a food delivery app and the USA is the dominant player?
Every country has the talent, software development isn't some esoteric knowledge. But even if you imagine that only people in developed countries are capable of writing software, there is Australia, New Zealand, Canada and Taiwan for starters.
I don't think it makes sense to focus on the US when three of the five companies in the article are from Germany, Netherlands and China. The problem is not America per se, it's the pattern of large and often (but not always) foreign companies extracting wealth from what used to be hyper-local operations.
> What countries have both the talent to build a food delivery app
It's not about "talent" these are utterly pedestrian apps that anyone mediocre team can fart out in a quick amount of time. It's about capital for massive scale, massive advertising, literal VC-subsidised dumping, takeovers of the competition, etc.
Sure, go to each country and check what food delivery companies operate in them, get a list of companies operating in the market that are not controlled by the big 5 mentioned in the article.
In Europe there were a few companies operating in the sector which were taken over by these global companies. I recall the Glovo takeover by Delivery Hero. You mention Foodpanda but you seem to be unaware this is a brand from Delivery Hero, and Just Eat is a Prosus company too.
> What countries have both the talent to build a food delivery app and the USA is the dominant player?
I'm baffled by your comment. Do you believe only the US has "the talent" to put together a food delivery business? Because even if you ignore the fact that 2 out of the 5 dominant players are not US companies, you need to be way out of touch with the reality of both the technology side and business side.
I work at Grab (and ex-Yelp). I am very familiar with FoodPanda and their owners as they are a direct competitor to my employer. I literally work for one of the non-American "local" food delivery services. But within out region, there are reasons we don't have technology offices in every country we operate in and we have tech offices in countries we don't operate in.
There are also reasons that we continue to exist while our competition pulls out of the region. There are also many reasons why hyper-local delivery services aren't able to compete with global or regional winners: Talent, access to capital, and TAM are big parts of that equation.
If someone that works for a non-american food delivery service provider is out of touch, I wonder what your credentials are that puts you in touch.
Also, in the blog, 2 of the 5 players ARE American (Doordash and Uber). The other 3 are European and Chinese.
As a software engineer in the US, I like that the US sucks up money from the rest of the world, that’s why my dollar goes so far when I travel and why I can retire in a non-reserve-currency country for cheap
Do you not feel as though that's incredibly anti-social? It's a very zero-sum "I'd prefer if things were better for me in direct proportion to how much worse they'll be for '_others_'"
There’s such a thing as collusion - convenient way to claim “we’re not a monopoly, there’s at least 4 more competitors” when behind the scenes they’re all talking and agreeing in price fixing, limiting offer, blocking other competitors.
That is known as a "cartel," which is also prosecutable under the Sherman Act. It applies to not just monopolies. But that doesn't seem to be the case here.
Edit: I wasn't accusing everyone who is critical of tech of being a Luddite. The attitude that nearly every tech company is a net negative for society goes quite a bit beyond criticism.