Ben Thompson, of Stratechery, has argued previously (Antitrust and Aggregation) that today's modern aggregators (Facebook for social interactions, WeChat for China commerce and business, and Amazon in retail) are in effect modern monopolies unlike the traditional monopolies of the last century:
...consumers are attracted to an aggregator through the delivery of a superior experience, which attracts modular suppliers, which improves the experience and thus attracts more consumers, and thus more suppliers in the aforementioned virtuous cycle...
Thanks to these virtuous cycles, the big get bigger; indeed, all things being equal the equilibrium state in a market covered by Aggregation Theory is monopoly: one aggregator that has captured all of the consumers and all of the suppliers.
This monopoly, though, is a lot different than the monopolies of yesteryear: aggregators aren’t limiting consumer choice by controlling supply (like oil) or distribution (like railroads) or infrastructure (like telephone wires); rather, consumers are self-selecting onto the Aggregator’s platform because it’s a better experience.
This emphasis (mine) offers a key insight into how these modern monopolies are different: we consumers enjoy being a part of them because we get better prices and better service. This is opposed to a traditional definition of a monopoly which often resulted in consumers being subjected to higher prices or reduced investment in the offering (or both).
A second difference we are seeing is that these platforms are dominating more than one business - for example, Amazon in retail and cloud - and using their size in each to generate synergies in excess of what each could produce independently. As noted, an oft-shared example of this is Amazon's use of AWS to power their retail business.
Zach Canter, writing for TechCrunch, has identified a third key difference:
In the 10+ years since AWS’s debut, Amazon has been systematically rebuilding each of its internal tools as an externally consumable service. A recent example is AWS’s Amazon Connect — a self-service, cloud-based contact center platform that is based on the same technology used in Amazon’s own call centers. Again, the “extra revenue” here is great — but the real value is in honing Amazon’s internal tools.
If Amazon Connect is a complete commercial failure, Amazon’s management will have a quantifiable indicator (revenue, or lack thereof) that suggests their internal tools are significantly lagging behind the competition. Amazon has replaced useless, time-intensive bureaucracy like internal surveys and audits with a feedback loop that generates cash when it works — and quickly identifies problems when it doesn’t. They say that money earned is a reasonable approximation of the value you’re creating for the world, and Amazon has figured out a way to measure its own value in dozens of previously invisible areas.
But this much is obvious — we all know about AWS. The incredible thing here is that this strategy — in one of the most herculean displays of effort in the history of the modern corporation — has permeated Amazon at every level. Amazon has quietly rolled out external access in nooks and crannies across their entire ecosystem, and it is this long tail of external service availability that I think will be nearly impossible to replicate.
Amazon's approach of commercializing and externalizing all aspects of it's business is clever: using market forces to ensure that relied upon systems and processes continue to remain the most efficient. This approach likely works best in high volume, price-sensitive businesses; this may not work as well for luxury goods or high-touch services. But as a match for Amazon - that continually focuses on getting product to customers faster and cheaper - it's a near-perfect fit.