As one of the largest economies in the world, the United States should have a diverse and changing business landscape. However, the reality is that failing antitrust rules are creating industries dominated by a handful of vast powers. On the surface, it can be hard to see the negatives of these monopolies, as they’re often accompanied in the press by words such as ‘productivity’ and ‘innovation’ but it’s still hard to deny that a lack of competition in business is having negative effects on the economy at large.
The Travel Industry
It’s an uncomfortable truth that the likes of Google and Facebook are at the top of the tech world because they have the ability to do things better and faster than anybody else. They have more money, a larger workforce, and access to wider talent pools. That isn’t necessarily a problem, though. The larger concern is that, by buying them up or otherwise forcing them out, larger companies have the ability to dictate which start-ups can shine in their respective fields.
In the travel industry, figures from Harvard Business Review reveal that the share of revenue held by just four airlines has increased by 24% in a decade, to 65%. It’s the same situation in healthcare, with 90% of hospitals having no competition at all. These figures are the product of something called concentration, and higher levels should alert the FTC’s Bureau of Competition to something amiss. Yet, those four airlines can run some routes with total impunity.
Healthy competition does exist. Google and Amazon have both struggled to crack the video gaming industry, for instance, both leading with quite poor products in comparison to native big businesses like Epic, Valve, and EA.
Looking at another side of the entertainment industry, there are signs that other industries offer healthier competition. There are so many different casino websites out there that the second group of companies has emerged to help customers sort one operator from another. The site bonus.ca reveals that up to 105 new casinos were launched in Canada during 2021, including ArcaneBet, Mr. Mega, and Cobra Casino. The number of new casino sites suggests that the market is healthy and not dominated by one entity, and is generally more balanced. This even goes to the extent that many sites offer bonuses to attract new players to their service.
So, what’s going on? While the onus is on regulators to dismantle monopolies, Google, Amazon, and Facebook provide services that might be considered unique so taking them apart could cause significant social or economic problems. However, the reality is that the growth of these businesses is being halted at some crossings by the appropriate authorities. Google earned the ire of europa.eu in 2019 for manipulating the lucrative advertising market and shoving out its rivals, for example.
The question that still needs to be asked is which industries are still ripe for the picking? It’s still important to fulfill a market need but some sectors are in desperate need of competition. Unfortunately, for the small-scale entrepreneurs, at least, many of these are big-money endeavors, like space travel. As space and the outer realms of our collective imagination become ever more accessible, earth’s orbit will become as much of a commercial asset as the cornfields of Iowa and Illinois.
Returning to Earth, the website inc.com reveals that the most fertile ground for setting up a new business at this point in the decade is in solving societal problems such as poor water quality in the upper Midwestern reaches of the USA. Eliminating draconian measures like the ‘pink tax’, which unfairly charges women more than men for identical products, and pushing healthier and more sustainable food products are just two of several areas that could benefit from increased competition in the future.
Overall, competition is either omnipresent or nearly absent depending on the industry under the microscope.
Main Photo by SevenStorm JUHASZIMRUS.