In theory, antitrust is there to prevent big businesses from grabbing too much market share. In practice, it can squelch the little guy just as easily as it can lift him up. Here's Jay Hancock, no foe of antitrust in general, on one recent action by the Federal Trade Commission:
This month Snyder's of Hanover and Utz Quality Foods, both in Hanover [Pennsylvania]…halted a planned merger after regulators intervened.
In deciding to extend its review of the deal, the Federal Trade Commission sought documents that would have cost the companies millions of dollars and months of uncertainty.
"They were asking for a lot of data—obviously a very expensive process" says Utz President Tom Dempsey. "We looked at it and said, 'We've got to make a business decision here.' We just decided this isn't something we're prepared to go forward on."
Too bad. The merger, which the companies said would have been layoff-free, could have given them fighting weight to compete against monsters Frito-Lay and Kraft. It would have been good for Hanover, where they employ a couple of thousand people.
Not in anybody's imagination (except maybe an antitrust regulator's) could it have hurt consumers.
Between them Frito-Lay and Kraft control well over half of the U.S. snack market. Frito-Lay makes the eponymous chips and other junk food. Kraft makes Ritz and Triscuit crackers and Mister Salty pretzels.
Snyder's market share, by contrast, is about 2 percent. Utz's is even less. Combined, they would control a smaller portion of the snack business than Microsoft's share of Web-search activity.