My developing theory is that monopolies can be great for innovation. What do ATT, Google, Xerox, and the old HP have on common? They are/were, if not outright monopolies, insulated from competition by virtue of network effects, brand or trademark monopolies, or simply a lack of competent competition. They weren't like the Acers of world, in highly competitive markets, struggling to make 1-2% profits on their revenues. They had steady sources of cash from products that had little market competition.

This allowed them to bankroll things like Bell Labs and Xerox PARC. Freed from living on the margin, they had the security to invest in blue sky projects.