Neil Netanel writing at Balkinization:
Is Google the New "Media Monopoly"?Neil Netanel
Microsoft's hastily renewed courtship with Yahoo --this time centered on a merger of the companies' search advertising businesses -- in order to compete more effectively with search engine leader Google raises issues not just of market competitiveness but of the shape of the new media landscape. In particular, might new media become as concentrated as the conglomerates and oligopolies that characterize much of traditional media? And if so, would new media concentration poses similar concerns about media concentration's deleterious impact on public discourse and expressive diversity?
We already see considerable concentration in some leading new media platforms. Google dominates the search engine market. Google’s YouTube dominates the market for user-generated videos. Facebook and MySpace dominate the social network market. Apple’s iTunes dominates the market for digital music downloads.
That's not surprising. Media, information, and telecommunications markets typically have built-in tendencies towards high levels of concentration and oligopoly, and new media are probably no exception. Such markets are characterized by declining average cost per unit of production, substantial economies of scale, and high barriers to entry. And demand-side network effects can exacerbate these tendencies in both new media and old. Amateur video creators want to post their work on the site with most viewers and viewers want to view the videos that everyone else is discussing. A search engine produces more useful results the more it is used—since frequent use enables the search engine provider to refine its search algorithm in response—and the more useful the results, the more people want to use the search engine. Similarly, social networking sites and peer-to-peer file-trading systems are also generally more valuable to any given user the more other users are on the network. Such network benefits can quickly tip the scales in favor of a single new media network as users stampede to the network that gives them the ability to communicate with the greatest number of other users.
Should we care if only one or two new media giants in a given area are left standing? After all, these new media are built on a model that is very different than traditional mass media’s hub and spokes. They are fundamentally platforms for user-generated speech and, in the case of search engines and content aggregators, user access to as broad a swath of expression as possible. ...
BTW, everyone should buy and read Neil's new book, Copyright's Paradox. It's truly one of the most important books about copyright.
RSS Feed