natural monopoly

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Natural Monopoly

A situation in which the barriers to entry for an industry or product are so high that it is not profitable for a second company to make an attempt. For example, an area may have only one utility company because it is prohibitively expensive to start another one. Governments generally regulate profits for natural monopolies to protect consumers.

natural monopoly

a situation where ECONOMIES OF SCALE are so significant that costs are minimized only when the entire output of an industry is supplied by a single producer so that supply costs are lower under MONOPOLY than under conditions of PERFECT COMPETITION and OLIGOPOLY. The natural monopoly proposition is the principal justification for the NATIONALIZATION of industries such as the railways. See MINIMUM EFFECT SCALE.
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Here a wealthy technical monopoly (Microsoft) acquires the news gathering and dissemination skills of an experienced broadcaster.

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