If there were thirty companies competing in the space then it could be good for consumers - e.g. by allowing economies of scale for the company and so reduced prices for consumers.
With two or three companies - yeah, not so much.
With two or three companies - yeah, not so much.
Antitrust law should really get amended with that framework in mind.
The problem with monopolies -- and monarchies for that matter -- isn't that they're inefficient. They're incredibly efficient. It's merely that the gains are almost universally used to enrich the owners of the means at everyone else's expense.
Standardization ≠ centralization, btw.
When everyone else is locked out of competing, the market owners lose incentive to do anything but maintain status quo.
There’s an interesting psychology here. We think of business leaders as hyper competitive, but they often seem to try to get to a place where they not only beat their competitors, but try to lock them out of the playing field.
Once there’s little or no threat from competition, doesn’t that get boring?
Athletes are competitive, but I think in a different way. I don’t think an athlete would find much enjoyment if they figured out a way to always be the only ones on the track, slowly meandering around by themselves.
A really good, palpable example of monopolies having a stifling effect is internet access, especially in non-urban US areas.
There's a graph on this page title "Perfect Competition, Monopoly, and Efficiency" [1] that shows how since the monopoly can price set they choose a higher price than where demand meets supply since it results in higher profits. This isn't achievable in a competitive marketplace as then somebody else would just undercut them.
Interestingly you can correct this inefficiency by subsidizing a monopoly so that it offers the correct amount of supply.
[1]: https://saylordotorg.github.io/text_principles-of-microecono...
Also economies of scale do work in software/creative ventures. However these tend to be cancelled out by other diseconomies of scale that are caused primarily by ineffective communication, aversion to change, and people (and government's) changing attitudes to larger companies [2].
What you referred to about creative teams being more cost-effective the smaller the company follows logically from most diseconomies of scale. For example in large companies the biggest decision makers tend to be isolated from the results of their decisions. This is in part because decisions take many weeks/months to be properly evaluated by a team of analysts (who may suffer from their own economies of scale if the business is large enough) and partly (I don't think this is written about but just my own opinion) because the biggest decision-makers will have the most authority and hence their subordinates will not be eager to tell them that their decisions had a negative response.
If anybody finds any fault in this comment please reply to it. Please be polite.
[1]: when a large company borrows from a bank they usually obtain lower interest rates as large companies usually tend to borrow large sums of money on which even a low interest is still very high.
[2]: if a company like Google makes decisions that could, from 1 particular angle, be considered as anti-competitive the government is more likely to consider the situation from that 1 particular angle rather than if a smaller company takes the same decision. However, this assumes a perfectly functional government in a MEDC (as LEDCs won't usually go after monopolies since they want foreign investment from large companies) that also happens to be non-corrupt
There's obvious cases where there's small teams that make outsized impacts and teams that grow too unwieldy to manage.
But there's a reason why we don't have 300 Linux Kernel projects: there would be a whole lot of duplication of effort and it would cost 300x as much.
Indeed, software has massive economies of scale because duplication is basically free. It has a bit more of a tendency to fall into monopoly or oligopoly as a result: there's barriers to entry but no production costs.