Their revenue comes from targeted, real-time digital advertising, both commercial and political.Īs a consequence of their integration into household behavior and commerce, Apple, Microsoft, Amazon, Google, and Facebook are among the very largest companies in the world in terms of market capitalization. Some digital service companies, by virtue of what they sell or provide for free, have developed the capacity to closely monitor the digital activity of individuals across the internet and monetize the results of that surveillance.
AMAZON GETS ANTITRUST SCRUTINY DATA USAGE SOFTWARE
Households spend significant resources on digital hardware and software for personal and work-related purposes, using these services for a huge set of activities, including communication, internet search, social networking, and the purchase of goods and services. Interest in these companies derives from the increasingly important role that digital services now play in the lives of individuals, commerce, and politics. Even though detailed information about business practices and competitive conditions can be hard to find, there is enough publicly available information to suggest that close antitrust scrutiny is in order for some of these firms. 3Īlthough the competition problem pervades the economy, there has been intense focus on the market power of large U.S. But these alternative explanations are becoming harder to sustain as empirical research accumulates. It is possible to take issue with any one of these measures and to argue that some of these trends actually reflect superstar levels of efficiency and returns to scale. 1 Moreover, stock market participants have been signaling the problem by assigning very high equity values to a relatively small subset of public firms earning monopoly profits. In many industries throughout the country, there is increased concentration, rising profit margins, declining entry, and low investment relative to profits. The data show that the United States has a competition problem.
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