- Paul Constant is a writer at Civic Ventures, a cofounder of the Seattle Review of Books, and a frequent cohost of the “Pitchfork Economics” podcast with Nick Hanauer.
- In this opinion piece, he discusses the “crisis of monopoly” with author Matt Stoller, who recently published “Goliath: The 100-Year War Between Monopoly Power and Democracy.”
- Monopolies lurk in all corners of American life. And – in the form of companies like Disney – they can determine how or where you get your entertainment. “If you want a vision of the future of show business, imagine Mickey Mouse’s giant yellow shoe stamping on a human face – forever,” Constant writes.
- For more on this topic, listen to the latest episode of “Pitchfork Economics.”
- This article is part of Business Insider’s ongoing series on Better Capitalism.
- Visit Business Insider’s homepage for more stories.
“A lot of people talk about our crisis of capitalism,” Matt Stoller announces early in the latest episode of “Pitchfork Economics,” “but what’s really going on is a crisis of monopoly.”
Stoller should know; he’s the author of a beautifully argued and elegantly constructed new book called “Goliath: The 100-Year War Between Monopoly Power and Democracy.” He digs deeply into how invasive monopolies have become and how they’ve shifted the power balance in this country.
When we talk about monopolies, Stoller says, we often have a few specific examples in mind: “Search and social with Google and Facebook, but also airlines and cable: Everybody knows that those are very concentrated and they transfer wealth from consumers and workers to financiers.”
In his meticulous research, Stoller has discovered that “it’s not just the big markets where you see this. You see it in pretty much every market. Things like peanut butter, or coffins, or missiles and munitions, or voting machines – everywhere in our society, you’re seeing this concentration of power in our markets, in the hands of the few.”
Most of us tend to associate monopolies with antiquated industries. Thanks to a certain terrible-but-ubiquitous board game, the old robber barons of the Gilded Age are still widely recognized as the symbol for monopoly in America.
But as Stoller wisely points out, there are monopolies in every corner of American life. In my time working at an independent bookstore, for instance, the top 10 large American publishers who accounted for the vast majority of book sales shrunk to the “big six” and then to the “big five,” which probably now accounts for about 80% or so of all American book sales.
This consolidation – as well as the inevitable diminishment to the “big four,” “three,” and “two” that coming years will bring if conditions continue unabated – results in a shocking inequality in the publishing field. With the big publishers gobbling up the majority of the book-buying market thanks to huge marketing and distribution budgets, the middle of the market is disappearing. The publishing industry now consists of an omnivorous “1%” and a selection of tiny publishers fighting to find purchase in an ever-shrinking share of the book-buying public’s attention.
Put simply, the middle is disappearing. If you want to buy a book, your options increasingly consist of a binary choice: You can either find your title at a neighborhood independent bookstore, or you can buy it from Amazon. In the face of all that consolidation, chains like Barnes & Noble are vanishing.
It’s not just books. Like many of you, I used the Thanksgiving break to catch up on The Mandalorian, a buzz-worthy Star Wars show on Disney’s new streaming service Disney+. Disney’s growth over the last two decades is nothing less than a monopolization of the entertainment industry. The company bought the studio that created the Star Wars franchise in 2012 for $4 billion and Marvel Entertainment for another $4 billion in 2009, and now it’s using those two franchises to provide content for its Netflix-competing streaming service, along with the content it acquired earlier this year when it bought National Geographic and all the other services owned by one of Disney’s main competitors, 20th Century Fox.
By all accounts, the strategy is working – Disney bragged about Disney+’s 10 million new subscribers in the service’s first week. But all those films and shows that used to be licensed to other services – your Netflixes, your Hulus, your HBOs – now live and die entirely in the Disney ecosystem.
In fact, the Trump administration is working hard to overturn one of the longest-standing anti-monopoly rules in show business. In 1948, the Paramount Consent Decree established that no movie studio could own a movie theater chain. This law prevented any single entity from owning every step of the motion picture business, from production to distribution. If the Trump administration has their way, it’s very easy to imagine a chain of Disney movie theaters from coast to coast, showing exclusive Disney films to people who pay a monthly membership fee added onto their Disney+ account.
And yet again, the problem is that this monopolization only leaves room for the giants. Disney’s consolidation of the market is leaving independent movie houses with fewer options and the theater-to-streaming-pipeline will devastate the distribution systems that used to rely on content from a broad variety of sources.
Perhaps the most poignant example of what happens when the entertainment market consolidates is the Paris Theater, the last remaining single-screen movie house in New York City. In September, the Paris closed its doors, citing the growing popularity of streaming services and rising rents as a major factor in the closure. In November, though, it was announced that a new company was reopening in the Paris’s space. Its new owner? Netflix. To make it all even more complicated, there have been rumors for years that Disney is interested in acquiring Netflix. If you want a vision of the future of show business, imagine Mickey Mouse’s giant yellow shoe stamping on a human face – forever.
I urge you to read Stoller’s book “Goliath.” It makes a compelling case that unchecked monopoly has been the leading driver of income inequality and a destructive force for American democracy. But it’s vital to remember that these huge sweeping forces affect our lives down to the smallest level. No single person can feel empowered to protect something as enormous and abstract as the fate of the American Republic. But monopoly is also an idea that affects us every single time we get home, kick off our shoes, and lie back on the couch to entertain ourselves.