Standardization/interoperability seems promising, but I want to suggest a stranger option: subsidies!
In general, monopolies maximize profit by setting an inefficiently high price, meaning that they under-supply the good. Essentially, monopolies don’t make enough money.
A potential solution is to subsidize the sale of monopolized goods so the monopolist increases supply to the efficient level.
For social media monopolies, they charge too high a “price” by using too many ads, taking too much data, etc. Because of the network effect, it would be socially beneficial to have more users, but the social media company drives them away with their high “prices”. The socially efficient network size could be achieved by paying the social media company per active user!
I was planning to write this up in more detail at some point (see also). There are of course practical difficulties with identifying monopolies, determining the correct subsidy in an adversarial environment, Sybil attacks, etc.
Standardization/interoperability seems promising, but I want to suggest a stranger option: subsidies!
In general, monopolies maximize profit by setting an inefficiently high price, meaning that they under-supply the good. Essentially, monopolies don’t make enough money.
A potential solution is to subsidize the sale of monopolized goods so the monopolist increases supply to the efficient level.
For social media monopolies, they charge too high a “price” by using too many ads, taking too much data, etc. Because of the network effect, it would be socially beneficial to have more users, but the social media company drives them away with their high “prices”. The socially efficient network size could be achieved by paying the social media company per active user!
I was planning to write this up in more detail at some point (see also). There are of course practical difficulties with identifying monopolies, determining the correct subsidy in an adversarial environment, Sybil attacks, etc.