Comment by cowlevel
5 hours ago
Is it even possible for doordash to be a monopoly? I understand that just about anyone can set up a website advertising food delivery for cheaper.
5 hours ago
Is it even possible for doordash to be a monopoly? I understand that just about anyone can set up a website advertising food delivery for cheaper.
From a marketshare perspective, it meets test of a monopoly in many localities. There is a "network effect" moat: the app is a storefront, payment gateway, and delivery network. The merger eliminates platform contention, giving customers perhaps greater choice of retailer but foreclosing the next largest platform alternative.
Their platform scopes and coordinates a market. They even recognize this in their announcement: "DoorDash and Instacart believe that communities benefit when Main Street competes"
If you're making a doordash competitor you can use doordash for order fulfilment on the back end until you build out your network.
The "consumer welfare standard" and related contestability doctrine is often used to challenge anti-trust action. However, requiring consumer harm neglects the loss of economic opportunity for providers (eg stores and gig workers).
If contestabilty, not marketshare, is the appropriate test of economic power, then laws may be needed to increase contestability, such as "data portability" rules for store owners so they don't have to key-in product description, availability, and pricing multiple times.
In your example of a new delivery platform entrant who bootstraps using its direct competitor, what legal framework protects that startup? This seems another contestability consideration.
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