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Monopoly Power
Practical Law Glossary Item 4-502-0835 (Approx. 3 pages)
Glossary
Monopoly Power
The ability of one company to control prices or exclude competition in a particular market. It is a requirement for the offense of monopolization, which is prohibited under Section 2 of the Sherman Act. Courts may evaluate the following factors to determine whether a company has monopoly power:
- Ease with which a competitor may enter the market.
- Market share in the relevant market.
- Size and strength of competing companies.
- Pricing trends and practices in the industry.
- Ability of consumers to switch to comparable goods.
- Strength of demand.