Hacker News Reader

Comment by JumpCrisscross | Hacker News Reader

Google's value vis-à-vis Exxon reflects Google having a lightly regulated de facto monopoly on search in most internet connected countries, while Exxon is in a fragmented, heavily regulated industry. Technology becoming the driver of the world economy would involve it (<10%) [1] passing industry (31%) [2] in its contribution to GDP.

[1] http://www.econstats.com/wdi/wdiv_533.htm

[2] https://www.cia.gov/library/publications/the-world-factbook/...

View on HN

Wikipedia lists the characteristics of a monopoly here:

http://en.wikipedia.org/wiki/Monopoly#Characteristics

Which of those characteristics do you see in Google?

Single seller - Google commands 2/3 of search engine volume [1] and 1/3 of online advertising [2]. Yes, they have competition, but in several verticals they are the only practical choice. Note that this does not make them an abusive monopoly, which is what those characteristics seem to be describing more than a monopoly per se.

[1] http://searchenginewatch.com/article/2289560/Googles-Search-...

[2] http://www.bloomberg.com/news/2013-06-13/google-is-projected...

In which verticals is Google the only practical choice?

Search engine marketing, for one.

But not search, like the original comment claimed?

... I'm actually surprised it's only 2/3. I mean, there are fringe geeks on DuckDuckGo, and IE Windows default search is Bing, but still I've never seen anybody IRL actually open anything but Google for a web search.

The Chinese use Baidu, the Japanese use Yahoo, the Russians use Yandex etc.

The more accurate list is the "Sources of Monopoly Power":

  * Economies of scale
  * Capital requirements
  * Technological superiority
  * Network externalities

All of these apply to Google, to some extent or another.

Physical strength is one source of bullying power. Would you say that anyone who is strong is a likely bully?

I think you are conflating a monopoly with the abuse of such.

> while Exxon is in a fragmented, heavily regulated industry

You seem to imply the assumption that the regulations in the energy industry don't benefit ExxonMobil.

If you have examples of that I'd be interested in hearing them. Otherwise the refutation is not really useful.

Exxon has run, on average, an 8.6% margin over the last 4 years (FY 2010-2013) [1]. Google runs at double that. This implies (though does not prove) that Google has more leverage in its market than does Exxon.

Do some government policies benefit Exxon? Likely. Does every government tax and regulate Exxon at the maximally efficient rate? No. But that is a far cry from saying Exxon would be worse off if, globally, resource-related regulation was pared back.

[1] https://www.google.com/finance?q=NYSE%3AXOM&fstype=ii&ei=QDv...

Reply on news.ycombinator.com