Monopolistic Innovation

Here’s a rant by someone that says that Monopolies allow innovation to flourish. Noting that the data that was used to back this argument in the article was primarily Bell Labs and the Department of Defense of US, it has a point.

It’s very similar to another discussion about having only one child at home. With no siblings to compete for resource, the child very quickly learn how to use all available resource for his own need. Those who are better educated by their parents would then try to use such resource towards a larger betterment, while others will simply indulge in the unconditional care without recourse. With at least a sibling at home, there would be competition for parent’s love, care, and attention. Even with the appropriate guidance from parents, resources would be spent demonstrating their worth over the other sibling (blatantly or discreetly) so as to earn the favor of the parent.

In any market that can always be seen when there’s a few concentrated players. Energy is spent destroying each other instead of trying out new things. After all, all businesses are set up to earn more money, and the most straightforward way is to do the Red Ocean thing and fight head to head. Blue Ocean thinking would have suggested that innovation is key, but when faced with a choice of sacrificing attention to your current base for unproven ideas, no management would be willing to stick their neck out.

So, as much as we hate monopolies (who pass high cost to consumers), shouldn’t we be creating monopolistic conditions when we want innovations? What is wrong with this argument?