What's Coming in 2024 on the Monopoly Front?

Google will finally feel the pain, the government will file a whole slew of antitrust cases, and monopolies will be a campaign issue. Plus a look-back at the key moments of 2023.

Welcome to BIG, a newsletter on the politics of monopoly power. If you’d like to sign up to receive issues over email, you can do so here.

Apologies for sending this one late, I have Covid. It’s pretty mild, but my thinking is slow, so my writing process is slow.

This is the first issue of 2024, and I’m excited, because finally we’re starting to see the results of antitrust enforcement. As I said in last year’s review, turning on enforcement isn’t like flipping a switch, it takes time and carries momentum, but the stuff launched since 2020 is starting to bear fruit and will continue to do so over the next few years.

For this issue, I’ll look both backwards and forward, both the broad trends in monopoly-related commerce and policy over the last year, and as well as what is likely next year. But make no mistake about what is happening, the revival of competition policy is a genuine revolutionary shift in political economy thinking.

Ok, so what were the basic narratives of 2023? There were two. First, it became much harder to construct monopolies via merger, as globally, mergers fell to a 10-year low (and Wall Street bonuses for deal-makers fell by 25%). Second, antitrust cases finally hit the courts in trials, with a few results, but setting up key decisions next year. This Wall Street Journal headline says it all:

As usual, we’re part of the story, so I’ll start with this community.

BIG Stats and Accomplishments

BIG is much bigger than it was last year. This year our humble newsletter passed over 100,000 subscribers, up 35% from 2022. That’s up from 76,647 at the end of 2022, 50,080 at the end of 2021, 35,513 at the end of 2020 and 17,690 at the end of 2019. So thank you for forwarding this newsletter to your friends and contacts!

On average, each issue in 2023 had 93.3k views, up from 67.7k in 2022. Ninety thousand readers for each article means we’re reaching a wide swath of people involved in this area, becoming one of the most important outlets on antitrust and monopoly. And yes, the influence is real. In April, I was invited to speak at the annual conference of the American Bar Association Antitrust Section, on a high-profile panel where I had to defend Biden’s antitrust regime against four corporate lawyers. The hatred and coldness from 400-500 antitrust lawyers in the audience was palpable if upsetting at the time, though in retrospect, it was delicious.

We’ve used our audience size to try and affect policy change. Back in 2022, for instance, BIG readers sent thousands of comments to the agencies on how they should rethink merger enforcement, and last month, these new merger guidelines were finalized, to the deep chagrin of Larry Summers and Wall Street.

Similarly, we were highly critical of Secretary of Transportation Pete Buttigieg in 2022 for failing to regulate the airlines, he then fined Southwest a record amount over mass cancellations, roughly 30 times larger than any previous penalty. This year’s holiday travel season was smoother than any had been in a decade.

Beyond just subscribing, 3,554 of you have signed up as paying supporters of BIG, up from 3016 paid subscribers at the end of 2022. That’s a growth rate of 18%. The growth in paid subscribers is lower than the growth of overall subscribers. That’s because I don’t tend to put up a paywall. The goal of BIG is to make a difference not a buck, so I mostly rely on your goodwill for the financing. That said, if you’ve been meaning to do so but haven’t gotten around to it, please join as a paying subscriber. Paid subscribers get a really cool Sunday round-up of monopoly related news that you won’t find anywhere else.

Ok, so for paying subscribers, here’s what we did with your investment. The biggest experiment we tried in 2023 was Big Tech on Trial, hiring young antitrust attorney Yosef Weitzman to go into the D.C. district court and chronicle the Google antitrust trial on a daily basis. Yosef was a much more straightforward reporter than I am, and he did a great job. We really lucked out in having him.

The strategy for Big Tech on Trial wasn’t to focus only on Google or the Antitrust Division, but the judge as well. Judges aren’t used to criticism, everyone in the legal fraternity kisses up to them, and reporters tend to write of them as if they are oracles. But judges are people, they act like people, they make mistakes like people and we decided to write about them like people. Judge Amit Mehta, who presides over the trial, is in many ways a conscientious man, but he also seemed pretty afraid of letting anything be public. And that’s where we stepped in, with our ‘How to Hide a $2 Trillion Trial’ article.

Our work led directly to a host of articles in Bloomberg and the New York Times on the excessive secrecy of the proceedings, embarrassing Mehta into opening it up and making more exhibits public. Mehta will be ruling on the Google case this year, and he now knows a lot of eyes are on him. Big Tech on Trial has been a smashing success, and w’re going to try and keep it going with other big tech trials.

So what else did we do with your investment? As it turns out, covering trials isn’t cheap. We were able to buy legal materials, from courtroom documents through the PACER system to trial transcripts. This was particularly important for the big health big data IQVIA-DeepIntent merger fight, as well as the Assa-Abloy trial. BIG was the only outlet that covered the IQVIA spat, which is meaningful for both legal and commercial reasons, and we did so because you made it possible.

We also hired writers to bring in additional expertise. Law student Sahaj Sharda chronicled the hub-and-spoke conspiracy of the Ivy League and U.S. News and World Reports, attorney Lee Hepner detailed the prevalence of price-fixing in our economy and the importance of private antitrust litigation, reporter Marian Baksh went into how software firms manipulate D.C. with a story on the Deep State Awards, and young antitrust lawyer Nathaniel Otto described the Fanatics monopoly over sports. And then of course there’s the great copy-editing from Todd Mentch, which prevents you from seeing most of my horrible grammatical errors.

Next year, we plan to continue hiring writers and find ways to invest in better coverage of monopoly-related issues, as well as offer ways, like with the merger guideline comments, where you can make a difference. If any of this sounds compelling, please join as a paying subscriber. Or just keep reading and forward this newsletter. We couldn’t do our work without you.

What Happened in 2023?

First, Google started feeling the pain. In December, the search giant lost its first antitrust case, to Epic Games, about the search giant’s control of the mobile app store via Google Play. Earlier in the fall, Department of Justice presented its case against Google over the firm’s search dominance, which got wide play despite the attempt by a meek judge to keep the trial secret. The search firm also settled a $5 billion suit over incognito mode on Chrome.

There was a lot of other big tech news. The FTC sued Amazon, the long-awaited case, based on Amazon hiking prices across the economy, which is something BIG highlighted in 2022. Meta beat the FTC in its acquisition of virtual reality app-maker Within, and Microsoft won its merger case, acquiring gaming giant Activision, though that case is on appeal.

Enforcers finally made their mark with wins. The Antitrust Division and the Federal Trade Commission won antitrust cases against the American Airlines-JetBlue Northeast alliance, as well as Illumina-Grail at the Fifth Circuit, and IQVIA-DeepIntent. In September, Lina Khan’s FTC filed a ground-breaking case against a private equity health care roll-up, which freaked out the industry (“A power grab against private equity threatens the US economy” was the headline of a piece in the Financial Times by Drew Maloney, the head lobbyist for private equity.) Khan also charged Amazon executives personally over deceptive practices in canceling Prime, and put out a draft rule banning non-compete agreements, a rule against junk fees, as well as a policy statement and actions against pharmaceutical patent fraud on inhalers and auto-injectors. The Antitrust Division sued over a wide-spread meat price-fixing conspiracy, and supported cases against rent-fixing. Oh, and realtors lost a huge private antitrust case, which will change our housing markets.

In terms of the larger economy, the era of zero interest rates ended, with Ponzi-style schemes - like the Medical Properties Trust hospital private equity scam - falling apart. The Federal Reserve continued its legacy of failure with its bailout of Silicon Valley Bank, insulin prices came way down, as did turkey, egg, and air travel prices, there was widespread labor unrest, in the auto industry, Hollywood, and in logistics. The Saudi LIV Golf-PGA Tour merger didn’t happen, and the resolution of the UAW strike was to have automakers re-open plants, showing labor policy is industrial policy. And this year, the Wall Street Journal editorial page got to 80 hit pieces on Lina Khan.

Finally, the government started getting a little smarter, changing merger filing forms to actually mandate collecting useful information to enforcers, and Congress passed a law mandating that merging firms share those filings with the Pentagon.

Predictions for 2024

Last year’s predictions were mixed. In terms of accurate predictions, I thought antitrust enforcement would ramp up significantly, that the Consumer Financial Protection Bureau would get into a fight with big tech, that the Ponzi economy would fall apart, that corporate margins would go down slightly and lead to strikes, that PE firms would fake their returns rather than mark down values, that courts would narrow Section 230, and that the Biden industrial policy framework would run into monopoly problems.

On the bad prediction side, I thought the FTC would win its case against Meta-Within, and that the Microsoft-Activision case wouldn’t make it to trial. I also thought crypto would go away, which it sort of has, but not entirely. Finally, I figured Congress would build on its success re-regulating shipping, and re-regulate another basic industry. I also thought it would pass a law on app stores. But nope.

Ok, so what’s going to happen this year? Here are my thoughts.

• Google will suffer significant legal losses and Wall Street will begin discussing how the firm should break itself up. The remedy in the Epic Games antitrust loss will not be sufficient, but it will be meaningful. In late 2024, Google will also lose the first stage of its antitrust case against the government involving search. It will also lose its adtech case. The search giant will appeal these results, setting up a Supreme Court showdown in 2025 or 2026.

• Banking will be revolutionized as the Consumer Financial Protection Bureau implements an open banking rule that mandates banks allow easy porting of data and accounts.

• The Antitrust Division and FTC will file cases against Apple, Ticketmaster, Exxon, Visa, UnitedHealth Group, and Real Page. A major PBM will find itself in the crosshairs of a case, and the FTC will file its first Robinson-Patman Act challenge in decades. The FTC’s case against Syngenta and Corteva over pesticide monopolization will proceed to trial.

• The government will lose its case against the Spirit-JetBlue merger, but win on appeal. The case against Facebook over its acquisitions of Instragram and WhatsApp will continue into 2025.

• As Pat Garofalo notes, state-level campaigns on junk fees, right-to-repair laws, hospital mergers, non-competes, and public utilities will pick up steam.

• Hollywood will seek to consolidate, leading to multiple antitrust investigations by the Antitrust Division and an explosion of anger by unions and creators.

• The Federal Trade Commission and a dozen states will file a case against the Kroger-Albertsons merger, and will win.

• The courts will invalidate the FTC’s non-compete rule and that ruling will go on appeal in the Fifth Circuit.

• The FTC will finally have some Republican commissioners, and they will be surprisingly supportive of antitrust enforcement, but deeply hostile to rule-writing.

• App store monopolies will continue to be under attack worldwide.

• There will be a serious effort to cut the budgets of antitrust enforcers, even as private antitrust enforcement ramps up significantly.

• The Ninth Circuit will overturn Microsoft’s district court win for the Activision acquisition, setting up a Supreme Court fight.

• Monopolization is going to be an issue on the campaign trail, with Trump making an argument that Obamacare fostered higher prices and Joe Biden talking about banning junk fees and making things in America.

Any predictions on your end? I’m particularly interested in what will happen in specific concentrated industries. Add your thoughts below.

Top Five Articles

Here are the top five articles from BIG in 2023.

(1) Why America Is Out of Ammunition (10/20/23)

(2) Time to Break Up Hollywood (5/14/23)

(3) The Middleman Economy: Why Realtors Just Took a Big Loss and Homebuyers Might Benefit (11/2/23)

(4) The FTC Sues to Break Up Amazon Over an Economy-Wide "Hidden Tax" (9/27/23)

(5) How to Hide a $2 Trillion Antitrust Trial (9/24/23)

Looking Forward to 2024

In 2019, I started BIG, hoping to chronicle a growing anti-monopoly movement, which had its origins in its modern form to anger at Too Big To Fail banks, but goes back, if you want to trace it that far, to the 17th century. I don’t think I could have imagined that writing about antitrust would have led to such significant social impact, and I’m honored to be on this journey with so many of you.

Thanks for reading. And keep those tips on monopolies flowing, they are essential to this work.

And if you liked this issue of BIG, you can sign up here for more issues of BIG, a newsletter on how to restore fair commerce, innovation and democracy. If you really liked it, read my book, Goliath: The 100-Year War Between Monopoly Power and Democracy.

cheers,

Matt Stoller