What makes a market, a market, anyway? A look at social media

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Imagine an antitrust action against an apple grower who supplies almost all the apples in America. If you were suing for a competition law violation, how would you define the market for an apple? Is it a snack market? For healthy snacks? For healthy hand snacks? For fruit? The list could go on and on. Defining the market for antitrust analysis becomes much more complicated for products or services that are newer, such as the social media market. With respect to the Sherman Act, one might think that because it has been combating monopolies for over a century, there can be no room for interpretation of what constitutes a monopoly, much less a market for this one. Over the past 100 years, however, new markets and questions about those markets have arisen. Social media networks probably did not cross the minds of the drafters of the Sherman Act in 1890.

Section 2 of the Sherman Act explains that “Any person who shall monopolize, or attempt to monopolize, or associate or conspire with any other person or persons, to monopolize any part of the commerce or commerce between the several States, or with foreign nations, shall be found guilty of a crime”. The United States Supreme Court has defined two elements of a monopoly under Article 2: “the possession of monopoly power in the relevant market and the deliberate acquisition or maintenance of that power, as opposed to the consequent growth or development of a superior product, business acumen, or historical accident. United States vs. Grinnell, 384 US 563, 570–71 (1966). Monopoly power is defined as the ability to control prices and exclude competition in a given market.


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