![]() But if United said one day, “I’m gonna raise my prices tomorrow” and American followed suit, there’s not much that antitrust law can do about it, Hay added. If a bunch of airlines met in a hotel room and decided to fix prices, they could be convicted of that, he explained. “The antitrust laws are not good about dealing with that situation,” he said. Each one has enough heft to exert influence. Hay said there actually aren’t that many monopolies, but it’s a different situation when it comes to oligopolies, which are markets with few suppliers.įor example, while he doesn’t consider the airline industry a monopoly, he said there are only a handful of major airlines. Twenty years after the Justice Department’s decision, in June 2020, DC said it was ending its relationship with Diamond and using other distributors for its releases, including Penguin Random House. However, Diamond Comic’s hold has weakened since. What are my options? Is Diamond my only real option? Or can I go to a book distributor? The government seemed to think at the time that anyone that distributed books could also distribute comic books,” Hay said. ![]() “Let’s say I a new comic strip, and I want to get distributed. While Diamond may have had a dominant share of comic book distribution, the Justice Department instead placed Diamond in the context of overall book distribution and determined they were too small a player. But by 2000, it found “allegations of monopolistic practices unwarranted.” ![]() In 1997, the Justice Department began investigating the company for alleged anti-competitive practices. The case of Diamond Comic Distributorsįor decades, Diamond Comic Distributors had been the primary distributor of comic books, functioning as a middleman for the likes of Marvel Comics and DC Comics. To determine if a firm has “monopoly power,” the lower courts generally require that a firm has a minimum market share of between 70% and 80%, according to the Justice Department. While “monopoly” is based on two Greek words meaning “single seller,” there are actually very few industries with only one source of product, Hay noted. But the law does not require that, explained George Hay, an economics professor at Cornell University. “For conduct to be called anti-competitive, it usually has to increase market power and hurt consumers,” Fox explained.Īnother misconception people have is that to be called a monopoly, a company has to be the sole seller in the market. It’s also hard to prove that a company’s conduct is anti-competitive because our law is conservative and the majority of the Supreme Court has a “libertarian view of markets,” according to Fox. There are more legal niceties to it, but essentially the conduct that is illegal is kicking the ones coming up the hill. Here’s an analogy that antitrust attorney Allen Grunes uses: “If you’re king of the hill, you can’t simply kick off anybody who is coming up the hill. Not only that, but being a monopoly doesn’t mean what you’re doing is illegal. “That’s a very tough standard for a plaintiff to prove,” Fox said. To be considered a monopoly, a company must have the power to limit output and raise prices, explained Eleanor Fox, a professor of trade regulation at the New York University School of Law. industries became more concentrated, as many companies in those industries grew bigger, sometimes through mergers.īut while some of the biggest have been pejoratively referred to as “monopolies,” designating them as such in the eyes of the law is much harder. And even comic book distributors.Ĭritics of big business say companies like these are becoming more powerful, resulting in a slew of issues that are detrimental to consumers, such as higher prices, product shortages and less competition overall.īetween 19, two-thirds of U.S. Is it purely a monetary issue that makes it a problem?īaby formula manufacturers. At one time there was some investigation by the Justice Department about this, but they decided it was not worth pursuing. What constitutes a monopoly? There only one real comic book distributor in the United States, Diamond Comic Distributors. Ever wondered if recycling is worth it ? Or how store brands stack up against name brands? Check out more from the series here. ![]() This is just one of the stories from our “I’ve Always Wondered” series, where we tackle all of your questions about the world of business, no matter how big or small. ![]()
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