Browse Definitions :
Definition

monopoly

Contributor(s): Matthew Haughn

A monopoly is the dominance of a specific market by a single business. Monopolies may result from a lack of competing companies in a given market or a limited number of companies that are strong competitors. These conditions can arise naturally but they are sometimes the result of aggressive, questionable and potentially illegal business practices including industrial espionage and backdoor selling

Monopolies can exist in reality or in effect. The latter situation arises when conditions exist in which a single business controls a supply channel despite the existence of competition. Effective monopolies are often referenced in the context of purchasing and procurement and specific to a company.

An effective monopoly situation can arise for a buyer in a number of ways:

  • Intellectual property ownership can prevent other suppliers from filling a need.
  • Customers may specify sources as a part of requirements.
  • The costs incurred switching suppliers could be prohibitive.
  • There could be a lack of technically acceptable solutions among competitors.
  • Company policies can create barriers to internal businesses or international suppliers.

When a single business holds a monopoly or other factors prevent free and open competition, market distortion results. Distorting the normal supply and demand model through monopoly can squeeze out new competition and inflate prices. Market distortion provides difficulty both for consumers and for private sector businesses following standard and ethical business processes.

This was last updated in August 2016

Continue Reading About monopoly

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

File Extensions and File Formats

SearchCompliance

  • PCI DSS (Payment Card Industry Data Security Standard)

    The Payment Card Industry Data Security Standard (PCI DSS) is a widely accepted set of policies and procedures intended to ...

  • risk management

    Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings.

  • compliance framework

    A compliance framework is a structured set of guidelines that details an organization's processes for maintaining accordance with...

SearchSecurity

  • Trojan horse (computing)

    In computing, a Trojan horse is a program downloaded and installed on a computer that appears harmless, but is, in fact, ...

  • identity theft

    Identity theft, also known as identity fraud, is a crime in which an imposter obtains key pieces of personally identifiable ...

  • DNS over HTTPS (DoH)

    DNS over HTTPS (DoH) is a relatively new protocol that encrypts domain name system traffic by passing DNS queries through a ...

SearchHealthIT

  • telemedicine (telehealth)

    Telemedicine is the remote delivery of healthcare services, such as health assessments or consultations, over the ...

  • Project Nightingale

    Project Nightingale is a controversial partnership between Google and Ascension, the second largest health system in the United ...

  • medical practice management (MPM) software

    Medical practice management (MPM) software is a collection of computerized services used by healthcare professionals and ...

SearchDisasterRecovery

SearchStorage

  • M.2 SSD

    An M.2 SSD is a solid-state drive (SSD) that conforms to a computer industry specification and is used in internally mounted ...

  • kilobyte (KB or Kbyte)

    A kilobyte (KB or Kbyte) is a unit of measurement for computer memory or data storage used by mathematics and computer science ...

  • virtual memory

    Virtual memory is a memory management capability of an operating system (OS) that uses hardware and software to allow a computer ...

Close