Is it illegal to own a monopoly?

[silvercharm516]

Generally, it is illegal to create a monopoly. However, there are specific situations when a monopoly is allowed and subsequently government regulated.

Utilities are a prime example. Gas, Electric, etc. The startup cost for another company to enter the market would be astronomical and would not work. In this situation, the government regulates the monopoly and tells them what they can charge for their services. Remember back to the days when AT&T was a monopoly on phone service. The market for that has changed with the invention of the mobile phone, but at one time they were a government-regulated monopoly.

Then you have to weigh things versus the old saying "If you build a better mousetrap, the people will buy it." If you create a product so good that through no effort of your own causes every competing product to go out of business, you did not behave in a non-competitive manner and are not considered to be a monopoly (because other products can always enter the market). But if you behave in a non-competitive manner such as exclusive contracts, prohibited pricing tactics or other things, your monopoly can and will be broken up. (Think about IE from Microsoft. They give it away "free" with windows which can price competitors out of the market unfairly and they've possibly illegally tied it to their operating system.)