From anti-antitrust to antitrust

It’s safe to say that without the breakup of AT&T the Internet revolution would never have happened. We might have had an online communication environment. But it would have resembled the useless French Minitel system rather than the open, public, democratic and dynamic system we have now. AT&T would have controlled all the platforms, switches, standards, and protocols that would have routed messages through the system. And it would have been more powerful and sclerotic than Microsoft ever was or Google ever will be.

These two former robber-baron enterprises are now complaining that Google's $3.1 billion acquisition of DoubleClick unifies the two leading Web advertising companies and thus crowds out all smaller competitors.

Back when antitrust was new and through most of the 20^th century it operated on the basic principle that too much power over a market was bad for society. American competition policy generally favored more firms rather than fewer, smaller rather than bigger and diverse voices in communication markets rather than a few loud ones.

Consider radio: In the late 1930s the new Federal Communication Commission issued ownership restrictions on broadcasters limiting how many stations they could own in a single market. The idea was to keep dominant voices at bay and allow smaller, locally owned stations to thrive. The effects were profound. Communities used radio to bind themselves and motivate themselves to improve their environments. And America gave birth to rock and roll.

We have forgotten those important lessons that helped America and the world accomplish so much and connect so many people. Since the Reagan administration antitrust has been out of style. Federal prosecutors and agencies rarely pursue obvious instances of excessive market power. They tend to focus on the price of products as the only indicator that a market is too concentrated. So they ignore other essential public goods like access to information and cultural richness and diversity.

Microsoft’s regulatory challenge to Google offers officials on both sides of the Atlantic a chance to rethink their competition policies in the world of information and communication. They can get beyond stale theories that undermine antitrust efforts and focus on doing what’s right for the public.

We need to keep an eye on emerging monopolists like Google just as we needed to rein in the last two decade’s monopolists: AT&T and Microsoft. Having governments go after those companies gave hope and opportunity to hundreds if not thousands of innovators and competitors. Thanks to appropriate regulation we live in a much better information ecosystem.

Siva Vaidhyanathan is an associate professor of Culture and Communication at New York University. His latest book is The Anarchist in the Library: How the Clash Between Freedom and Control is Hacking the Real World and Crashing the System (Basic Books, 2004). Siva blogs at Sivacracy.net.

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