Even today, Microsoft enjoys dominance in the market, recording $51.9 billion in revenue in Q4 2022. Microsoft has enjoyed a monopoly in the computer and technology industry since 1999. Therefore, Google undoubtedly is one of the giant monopolies in the world, with a notable presence in several other markets as well. It gives Google an advantage over smaller advertisers who do not have access to the same level of user data. Its business model heavily relies on collecting user data to personalize ads based on the user’s search history and location. The company’s primary source of revenue is advertising, and it currently controls a striking portion of the global advertising revenue, estimated to be around $224.47 billion in 2023. Thus, it is a superior player in the industry. Google has a significant market share in the internet industry compared to its competitors, such as Microsoft and Yahoo. Monopoly Examplesīelow are the different Monopoly Examples: Example #1: Google Government Monopoly: It is a monopoly where the government owns and controls a particular industry, sector, or business.Įxample: Water supply, electricity distribution, and mail services are prominent examples of government monopoly. Technological Monopoly: It is when a company or business has access or exclusive rights over a technology or manufacturing method that no one else can use.Įxample: Pharmaceutical companies with patents for certain medicines can fall under technological monopoly examples.Ĥ.

Geographical Monopoly: It is when there are no other sellers available in that part of the world.Įxample: A local cable servicing company has a monopoly in a particular area in a city.ģ. It also has many barriers to entry into the market.Įxample: The most familiar examples are the oil and gas, railway, and aviation industries.Ģ. Natural Monopoly: It is a situation where it is best if only one seller makes and sells a product. The extent of monopoly power depends crucially on how we define the market.1. A profit-maximising firm with market power is most likely to use that market power to charge higher prices than if an industry was more competitive. The ability of a firm to influence or control the terms and condition on which goods are bought and sold.

Even firms with a lot of market power might need to consider the threat of potential rivals.

Market power depends on the structural characteristics of the industry.

Ability to harness barriers to entry to maintain supernormal profits in the long run.

Price setting power including the option of using price discrimination.

What are the key features of a business having monopoly power in one or more markets?

Most industries are contestable to a degree – there is always the threat of potential rivals Technological change creates new substitute products and competitors and helps to bring entry barriers down the Royal Mail lost their monopoly in parcels and letters deliveryĬompetition authorities might find other ways to inject competition e.g. What stops an industry becoming a pure monopoly?Ī pure monopoly might have their legal monopoly taken away e.g.

A firm might have localised monopoly power with no close substitute available.

High trade barriers which give increased monopoly power to a domestic firm protected by import tariffs.

Some state-owned firms have monopoly status. licences required to operate, awarded franchises can give local/regional market power.

High regulatory barriers to entry e.g.Significant internal economies of scale – the minimum efficient scale may be so high that only one supplier can fully exploit available economies of scale (i.e.

What are the key characteristics of pure monopoly?

A near pure monopoly occurs when one firm has a market share in excess of 90 percent.

The nature of the market is that no close competitor or substitute exists.

The firm effectively is the industry in this situation.

A pure monopoly is a single supplier within a defined market or industry.

Bilateral monopoly examples