Not really... Anticompetitive would be if:
1) The entrenched players were selling at "zero profit" or price equal to marginal cost. (I find this dubious, they are monopolies after all. internet services are a fraction of the US price in many European countries)
2) Google were doing this with the intention of raising prices once all of its competitors go out of business. Since they are behemoths in their own rights, I just don't see Google having the desire to push a price war to this point.
In general "dumping" is hard to establish since no one is going to reveal their cost structure. In my experience it is normally an accusation flung by incumbents because that other guys stuff is too cheap.
If it breaks the back of the ISP monopolies and forces them into the role of unprofitable utility, all the better. That's the whole point of market forces, right?
Google could not force major ISPs out of business even if they wanted to. They just don't have enough money. Verizon and Comcast combined have more than 3x Google's revenue.
And if Google Fiber is indeed a loss leader, then each successive deployment will be more difficult to finance. And they've only deployed a few small communities.
But that's not Google's goal. Their goal is just to make sure that consumers have a broadband alternative in the markets where they currently do not. That's much more modest, and to me it seems competitive rather than anti-competitive. I certainly hope they come to my town, where Comcast is the only option if I want more than 5 Mbps.
It's called having a loss leader, and there are hundreds of products/companies that do it. You commonly purchase products sold as a loss leader. Hell, steaks at most restaurants are sold at a loss with the hopes you'll order a drink.
In this hypothetical situation, Google uses its internet access as a loss leader to sell hypothetical services which require high speed broadband. Traditional ISPs will use internet access as a loss leader to other services, such as phone and television.
Downvotes seem unwarranted, this is the definition of "predatory pricing", which is just a company using the profits from one business to undercut in another with the intent of forcing competitors out of business.
Though I don't know that it really applies here - they're unlikely to drive TWC-Comcast out of business by pricing low in just a few areas. It's more of a concern when it's a large monopolistic company doing it to regional competitors to maintain their monopoly.
But those companies do the same thing to competition. If all sides are below-cost then it goes back to being fair competition, and it weakens monopoly power.
Okay that is anti-competitive, than what shall we call dumping a useless service onto consumers that they have to overpay for? Also these ISP's keep their competitors at bay, so consumers do not have a choice but to pay them high fees for useless service.
Thats the kind of idiotic arguments that were put forth during the early progressivist movment. It used to be that anti-competitive meant actually doing something bad, the progressiv transformed it to 'companys who might do something bad in the future'.
How about we use common sence and let competition work its way until we actually OBSERVE bad effects instead of condemming a company because they might do something bad at some point in the future. Is this not one of the major advances that was made law in the last 200 years?
Most of the historical example of these laws in practice are so absured that you can only laught about them. Companys not allowed to unite because they would togheter have 8% of a market.
This law, since it has been on the books has served as block for competition WAY more often then it has helped. I encourage everybody to look at this history of this law and not JUST the 2-3 partial success story that seam to be the only once that are ever talked about.
You are right but it's deeper than that. "Anti-competitive" is not even a valid concept.
Companies are supposed to do everything they can to beat their competition. That is simply called "being competitive."
It's kind of like the word "progressive" as in "the Progressive movement." It's a linguistic deception that started out as a kind of dishonest propoganda.
It's a perfectly valid concept. A company takes action not aimed at succeeding in the market, but instead aimed at damaging their competitors. The direct goal is to reduce the amount of competition in the market, aka being "anti-competitive".
Companies are not supposed to do everything they can to beat their competition. That's closer to a description of organized crime.
There is no action a company can take to damage their competitors other than succeeding in the market by offering a better or cheaper good or service.
That is in free market capitalism, where the initiation of force by the government or companies against other companies is barred.
For instance, in free market capitalism, telecom companies are not granted local monopolies, so the only way for a telecom company to hurt its competition is to beat its competition on price or service, since anyone is free to build telecom infrastructure. (Obviously, this is not the system we have in the US, where telecom monopolies are rampant, but we should.)
> Companies are supposed to do everything they can to beat their competition. That is simply called "being competitive."
Real competition is stabbing your competitors in the face and taking their stuff. We prohibit that because it rewards the wrong kinds of competitors. Prohibitions on anticompetitive conduct are rooted in the same principle.
Under laissez-faire (i.e. rights-respecting) capitalism, the initiation of force is barred. Prohibitions on "anticompetitive conduct" are separate from that. They are a restriction on what companies can do in addition to not using force.
In general "dumping" is hard to establish since no one is going to reveal their cost structure. In my experience it is normally an accusation flung by incumbents because that other guys stuff is too cheap.
If it breaks the back of the ISP monopolies and forces them into the role of unprofitable utility, all the better. That's the whole point of market forces, right?