Antitrust litigation, even if it fails, has a powerful effect on corporate behavior.
Interoperability is key to a competitive marketplace, giving users freedom to choose and breaking mutual hostage-taking situations.
Deep dives
The Power of Monopolies and the Weakening of Antitrust Laws
In this episode, sci-fi author and technologist Corey Doctorow discusses how the power of monopolies and the weakening of antitrust laws have allowed big tech companies to protect their competitive advantage. He highlights the influence of Robert Bork's book 'The Antitrust Paradox' and the subsequent decline in antitrust enforcement. Doctorow cites examples like the drinks industry's influence on anti-binge drinking programs and the firing of a drug czar for refusing to promote alcohol as safer than cannabis. He explains how lobbyists manipulate truths by mobilizing monopoly rents and solving collective action problems. He also discusses the current antitrust cases against Facebook and Google and predicts that even if they lose, they will have a lasting impact by changing the character of these firms and sending a signal to their rivals in the market.
The Importance of Interoperability in Addressing Monopoly Power
Doctorow emphasizes the role of interoperability in addressing the problems of monopoly power. He recalls historical examples where companies created interoperable products that challenged dominant players, such as Apple's Pages, Numbers, and Keynote competing with Microsoft Office. Doctorow argues that allowing interoperability gives users a lower barrier to entry and the freedom to choose which parts of a dominant service they want to use. He suggests that creating an interoperable Facebook service, for example, can provide alternatives and break the mutual hostage-taking situation among users. Moreover, he calls for a change to the current trend of Aqua hires and aggressive acquisitions that prevent startups from making a significant impact in the market.
The Need for Legislation to Address Monopoly and Collaboration
Doctorow discusses the structural changes needed to prevent the repetitive cycle of innovation, monopolization, and antitrust battles. He highlights how firms collude, merge, and engage in anti-competitive practices, leading to a lack of real competition and stifling the market's ability to aggregate decisions. He argues that changes in laws, such as avoiding aggressive acquisitions and tightening M&A rules, could create opportunities for new entrants and startups. Doctorow stresses the importance of maintaining competition and preventing collusion between dominant firms through legislative measures. He suggests that incentivizing startups that create actual products, rather than aiming solely for acquisitions, can lead to true innovation and a healthier market.
Cory Doctorow, award-winning author, technologist, and founder, joins Azeem Azhar to explore the power of big tech monopolies and how a future wave of antitrust lawsuits could unleash innovation across the sector.
They also discuss:
How antitrust litigation, even if it fails, has a powerful effect on corporate behavior.
Why interoperability is key to a competitive marketplace.
How software patents have been weaponized to protect monopolies.
