Posted on July 13, 2012 by Abby Johnson | (4 votes, average: 4.00 out of 5)
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There is no disputing the fact that competition has been dramatically debated in the tech industry in recent years. Google, Facebook, Apple, and many other companies that we would consider major players in the tech space have all been questioned, and many of them have even been investigated. But, are they really violating antitrust law, and is competition really that bad?
Adam Thierer, a senior research fellow at the Mercatus Center at George Mason University, doesn’t think so. According to him, the “Rule of Three” applies to the tech sector just as it does to any other sector in a capitalistic economy. At any given time, there may be three dominant players in various sectors of tech such as search and browsers, but, as he explained, “creative destruction” happens much faster in technology than it does in other industries. The fall of Myspace, for example, is a perfect illustration of this happening.
“Just because these companies are large, it doesn’t mean that big is bad,” said Thierer, “or, in this case, that big is uncompetitive or non-innovating. In fact, to the contrary, despite the fact that some very large players dominate various sectors of the digital economy.”
As these antitrust concerns have grown, it seems that a lot of them have evolved around privacy concerns, which is unique since antitrust typically involves price, quantity, and quality. Thierer questions this addition of “privacy” to the mix, but also told us that current antitrust laws, in general, are too dated.
However, since the digital space is impacting society more and more, he believes that policymakers and regulators will continue to be active in getting involved in the Internet. Thierer would like to see Washington apply Moore’s law to these issues, which would mean that laws could drop or change every couple of years in order to keep up with the pace of technology.
Although it seems like a logical solution to him, Thierer said he is not optimistic about it coming to fruition. Eventually though, he said there would likely be a bill that would cover these issues.
Do you think competition is lacking in the tech sector? Let us know.
4 Responses to Is Competition Really a Problem in the Tech Industry?
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Good video, its true that competition is really big issue. Good explanation and good presentation. Thanks for sharing.
If big players as you mentioned Google, Apple facing this issue then how can small companies survive. Good post, need more discussion on it.
You are very right big tech players have occupy the technology market like Apple, Google and soon… But good and new technology can give some competition but success will require time.