Paul Little seems…uhm…ahh…err…’confused’

Paul Little has a rage in the Herald on Sunday about monopolies, triggered by the proposed merger of his employer NZME. with Fairfax.

When the all-but-inevitable merger of media companies NZME and Fairfax was announced, journalistic reaction fell into two camps. Those with secure jobs regretfully accepted that it was probably for the best in the long run. Those without security of tenure heard the bicycle bell of the Newspaper Boy of the Apocalypse.

Some members of the public lamented yet another kick in the guts of journalism, and many more worried about possible effects on their daily diet of Naz and Jordan.

Whatever else this merger is, and whatever its results in terms of the information we get, it is part of a seemingly unstoppable trend towards monopoly in all areas of commerce.

Sky is a monopoly and yet it got reamed last night with the boxing. Monopolies have a habit of dying too…remember when the US government took Microsoft to court using anti-trust legislation. The government took more than 10 years to stop something they didn’t like in 1995, but it took the internet less than 5 years to remove Microsoft’s monopoly.

Which is funny because Paul Little blames the ultimate is distributed control, the internet, for the creation of monopolies.

[I]n everything from retailing to computing, single names dominate their markets.

Blame the internet. The worldwide web has abolished space and time. Companies can take and supply digital orders any time from anywhere.

Distracted by the potential of this brave new world, we have allowed this trend to sneak up on us. No one questions why, although there are many search engines, only Google has become a verb.

Globally there is one online auction site in most countries – New Zealand is the odd one out with Trade Me apparently too dominant to let eBay in.

You might think you’re on to something if you’ve been getting around without the help of Google Maps and recently switched to GPS navigation system Waze which, among other points of difference warns you of upcoming cops and red-light cameras. You might also be surprised to know Google has owned it since 2013.

Google also owns the online video sharing/piracy website YouTube, which has 75 per cent of that market.

I’m not sure Google will take kindly to Paul Little describing Youtube as a piracy website. I hope Paul Little never discovers that Waze is an Israeli company, staffed by ex-soldiers who developed the software for the IDF.

The raging continues.

Meanwhile, non-digital companies are extending their dominance too, also often in disguise. That folksy soft drink or fruit juice or flavoured water with its “aw shucks” yarn on the label and antiquated type face is as likely to be owned by the Coca-Cola company as anyone else.

Although here are lots of sites where you can buy books online, most people would name Amazon which, in 2013, bought Goodreads, the immensely popular site on which “real” people share their opinions of books. When Book Depository appeared with international free and rapid delivery and cheaper prices, many rejoiced. Amazon bought Book Depository in 2013. No wonder people have gone back to bookshops.

It’s impossible to under-estimate Amazon’s reach or ambition – it now sells food, clothing and just about anything else you might need, and in some areas in the US promises two-hour delivery.

Social media? Facebook bought Instagram in 2012, and with Twitter shares at an all-time low, it is poised for purchase.

So what? I’m missing the point here, I think. Are people really returning to bookshops? I only went in one yesterday because the missus was looking for ideas to download on her Kindle. I can’t remember the last time I went into a book shop.

But are monopolies bad? With economies of scale and centralisation, they can keep prices down and develop services without wasting time and effort on fending off competitors.

Well they could, but most monopolies put their obligation to make a profit before any other aim. There’s no one to stop them in an increasingly liberal regulatory environment.

So it’s no surprise these trends are occurring in tandem with the greatest increase in the wealth gap the world has ever known.

There are ways to stop monopolies…change the market. That’s what happened to Microsoft. Software went to the cloud, the desktop dominance was dead almost overnight. Licensing, which was previously extortionate, became small monthly payments. The distribution model, the sale model, the development model changed almost overnight and the market leader became the also ran.

Nokia and Motorola were dominant in the mobile market until Apple changed the market. Their near monopolies were gone overnight. Blackberry suffered the same fate, and all with the delivery of the first iPhone.

You might think Apple dominates the cellphone industry now…and you’d be wrong. Samsung sells way more handsets than Apple and has done for at least 10 years. Monopolies can and are challenged.

But myopic idiots like Paul Little always bemoan the changes.

This column is utterly confusing. I read it twice to discover is there was a point to it, and found that there wasn’t.

I am starting to think that Paul Little is the Herald’s “special” quota.

 

– Herald on Sunday

 

 


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  • ex-JAFA

    One of Little’s vague attempts at a point was saying “most monopolies put their obligation to make a profit before any other aim”. Perhaps this comes as news to him, but monopolies are just like any other business in that regard.

    Socialists I’ve spoken to have a terrible time comprehending the fact that businesses exist only to provide profit to their owners; the mechanism by which they do so (what they sell, where they’re located and who they might employ) are very much secondary concerns which only serve to support the primary function.

    • Platinum Fox

      I’ve always said that companies that lose sight of their primary objective of making a profit in favour of some other mistaken objective such as achieving first ranking in market share or some ephemeral customer satisfaction measure are headed for oblivion. It’s very difficult to focus on multiple objectives and the reality is that many companies have “objectives” which they fail to recognise are really constraints on achieving the best possible outcome on their profitability objective. Investors will eventually withdraw their capital support from such companies or will support an alternative ownership structure which can maximise the return on capital from the business.

  • shykiwibloke

    The whole thing strikes me like a 4yo tantrum – my world is changing and it’s got to be someone’s fault. Grow up Paul. Every other industry has been changing for decades, why should you be any different?

  • Graham Pilgrim

    Paul Little is one of the reasons I cite for refusing any offer I may be made, free or otherwise, by the Herald’s subscription department.

  • arnietm

    The problems with News Papers and media in general there are very few if any genuine reporters left. They have lost the art of telling the whole story in onenewsitem.

  • XCIA

    If the MSM amalgamation commits to a change of direction in its strategic path forward and as a consequence sheds those whom it determines as “well poisoners”, I can not see Little in the new organisation.

  • David Moore

    Monopolies do not exist outside those created by government. While companies like Google dominate, they do so simple because they are so much better than the alternatives.

    His idea that what he claims to be monopolies put profit before all else also proves that companies like Google and Amazon are not monopolies. Amazon, for example, barely makes a profit worth the name, they operate on 1% margins. Google/Facebook don’t charge a cent for extensive and great tools that billions use. If they truly were monopolies, they could charge for the service as well as the ads.

  • RockinBob625

    Even in a monopoly position, the consumer has a maximum price they will pay for anything. Just because you are the only producer of widgets, doesnt mean I will pay your asking price.

    Thats why NZME & Fairfax have to merge, because the consumers have judged your product to be not worth a brass razoo.

    • Uncle Bully

      Similarly Sky’s asking price of $50 for a boxing match. People will either forego watching, or seek a cheaper alternative.

  • Usaywot

    Is he related to that other idiot of the same name?

  • JEL51

    Paul, Paul, PaaaauuuuuLL, you are sooooooooooooooo right. “…. No one to stop them…..obligation to make a profit…”……………….. (how dirty!!)…..

    All this downsizing is really scary but you must realize that a company cannot survive on an ever decreasing readership. The public would support an industry like the one you are in, if it didn’t play games. The Public don’t like being played as fools. I hope you are not one of the many that may have to go-it-alone as I will sure miss laughing AT your Silly Little Leftist Games.

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