Quote Originally Posted by wufwugy View Post
Yo Ong I really wanted to hear your thoughts on this.
Sorry been busy preparing to move house, plus work.

The second question, I'll answer that quickly... no.

The first one... what makes a natural monopoly? In my opinion (I'm not pretending to be an economist) it's a service that is both essential and comes from a single source, where the consumer has very little (not necessarily zero) choice but to use.

A natural monopoly is a business model where direct competition doesn't exist, and profit is essentially guaranteed by the need of the people to use the service.

I understand your point about bottled water and tap water being in competition with one another, but it's indirect and the tap water company needs to be performing particularly badly before a significant shift of custom moves to bottled water. So ok tap water companies can't literally charge what they like, but they can still overcharge while being "competetive" enough so people don't start bathing with bottled water.

So tap water is a natural monopoly, at least I believe so. People need it, and there is only one source.

Energy is another. I know savy seems to think that you can literally choose to use a different power plant, but you don't phone the plant and ask them for quotes. The "competition" here is an illusion... you're buying the same power from different middle men who charge different prices. What's the need for this competition? So the consumer has to figure out which one is taking the piss the least?

The only real competition enegery companies have is people investing in renewables, but for most people it's prohibitively expensive and therefore the energy companies are providing an essential service that the consumer has very little real choice on. Another natural monopoly.

You can't not make these things a monopoly. That's why they're natural.