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Comment by mlthoughts2018

4 years ago

I think it’s better to say it creates an oligopoly among the few strong competitors at the chokepoint non-commodity layer.

Various smartphone developers made app ecosystems into commodities, so those developers have a very, very large market share of all smartphone taken together.

But I do agree that this strategy doesn’t, on its own, create a monopoly for one member of the chokepoint layer vs another. It helps by allowing businesses in the chokepoint layer to be price-neutral to other layers above or below them that are commodities (those layers face so much price competition that they have no negotiating power on the other layers) and focus on monopoly strategies against other competitors in the same layer, free of concern about needing to compromise with other layers.