A monopoly is usually described as an industry with a single firm that produces a product for which there are no close substitutes and in which significant barriers to entry prevent other firms from entering the industry to compete for profits. Anti-trust economist Frank Fisher describes monopoly power as the ability to act in an unconstrained way, such as increasing price or reducing quality.
Many arguments have been put up regarding monopoly and monopoly power. The antitrust enforcers in the United States and the European Community are concerned about the high profits many monopolists earn. They argue that these profits come at the expense of consumers, who must pay higher prices for limited output. However, there are others who argue that monopolies arise when a firm discovers a more efficient way of manufacturing a product that fulfils unmet consumer needs.
However, over a long time period, I believe that a monopoly will fail in society. Consumers usually benefit from competition through lower prices and better products or services. Companies that fail to understand or react to consumer needs may soon find themselves losing out in the competitive battle. Hence, firms will always seek and try to find new and better ways to improve themselves. With monopoly power present however, such benefits might be affected as companies with the monopoly power will have control over prices and outputs. As a result, prices can be artificially high.
Some monopolies exist not because its product or service is superior to others, but because it has obtained market power by suppressing competition with anticompetitive act. This will result in an unhealthy business environment. Smaller players in the market tend to be "bullied" and kicked out of the game due to their lack of financial abilities and resources. The ultimate loser in this "game" will be the consumer. Consumers may lose out by paying higher prices and not getting the best.