Not legal advice but the term “related market” is defined at the level of an industry or even more broadly than that. That’s because, if you define any market narrowly enough, you\u2019d be able to claim that even the streetside vendor outside your house is a monopoly e.g. \u201cGTM360 is a monopoly because it\u2019s the only provider of marketing solutions whose name starts with G and ends with 0\u201d.<\/p>\n
Playing footloose with the definition of related market will lead to antitrust regulators shutting down (or breaking up) virtually every company on the planet on the pretext of being a monopoly. Obviously, nobody wants such an enforcement action.<\/p>\n
In exceptional circumstances, courts have ruled some markets with multiple suppliers as a monopoly when the largest supplier had a market share of above 90% (or even 70% under SATA – Sherman Antitrust Act<\/a>). See sidebar below for a summary of court rulings on this subject.\u00a0<\/p>\n <\/p>\n Here’s a partial list of companies that have been called monopoly in the public discourse:<\/p>\n Let’s look at the related market in which each of them operates:<\/p>\n As we can see, all three companies operate in markets with multiple suppliers. Therefore, none of them is a monopoly.<\/p>\n I don’t want to get into sub-markets but I can’t resist the chance to debunk an egregious case of false accusation of monopoly wherein a\u00a0tweeple describes a bad experience with Indigo Airlines<\/em><\/strong> in the following thread on X fka Twitter:<\/p>\n I pointed out to the OP that Indigo is not a monopoly since there are half a dozen airlines in India. They replied back saying Indigo has a monopoly on the said BOM-BLR route.<\/p>\n This is nonsense – as noted earlier, monopoly is defined at the level of a broad “related market”, which is aviation in this case. There’s no such thing as “monopoly on a particular route”.<\/p>\n But, just to indulge the OP, I did a quick search of BOM-BLR flights for 15 Jan 2024<\/a>. This is what I found:<\/p>\n Total flights (nonstop only): 39<\/p>\n of which:<\/p>\n (Click here to download<\/strong><\/a> the search engine results page as a PDF.)<\/p>\n There are five airlines operating on this route, ergo Indigo is not the only supplier even on this route<\/em>. With 14 flights out of 39 (36%), Indigo has nowhere near 90% market share. Therefore, Indigo is not a monopoly on this route, even if a regulator were to get overzealous and apply the term at the sub-industry level.<\/p>\n If there was a monopoly in the aviation industry, it was before the liberalization of the Indian economy. During the so-called License Quota Raj<\/em> (LQR) era that lasted until 1991, Indian Airlines<\/em> <\/strong>was the only airline operating in India.<\/p>\n In modern times, if we go strictly by the legal definition of the term, I can’t think of a single monopoly – in India or anywhere else in the world. The only exception is utilities like MSEB<\/em> in Maharashtra and PG&E<\/em> in California. That’s like an exception that proves the rule since regulation is deliberately written to encourage<\/em> monoplies in utilities, per Matt Levine, author of the Money Stuff<\/em> finance newsletter.<\/p>\n No. Common Man and Regulator may play footloose with the term Monopoly but Court rules Monopoly only if: — Ketharaman Swaminathan (@s_ketharaman) October 26, 2023<\/a><\/p><\/blockquote>\n\n
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1) There's only one supplier in the market
2) #1 has happened due to govt decree
3) Sole supplier hurts consumer by price gouging.
Ergo monopoly verdicts are rare.<\/p>\n