Private Investor: Now it's time to play monopoly on the internet

What a lucky punt! Yes, indeed. In a miracle of good timing last week, I managed to sell out of ITV and into Rightmove. Since then ITV's chances of being the subject of some sort of takeover have diminished even further with the appointment of Michael Grade as executive chairman.

Between James Murdoch's near 20 per cent stake in the group and Grade's formidable personality, I can't see Richard Branson and his allies breaking into the channel. The fact that I managed to exit with a modest profit eased that particular pain.

So, noting some weakness in Rightmove's share price on the back of a negative broker's note, I just piled in. Without wishing to stir up unpleasant memories of the bubble, I have to say that Rightmove fits into my personal "new paradigm" of online business. In the tech-media- telecoms bubble "new paradigm" usually meant a firm had no customers, a phenomenal rate of cash burn, and a name that meant little to anyone, despite millions spent on advertising it (ironically, in the "old media" such as the one you're holding)., for instance. Remember that?

Anyway, of course, some online businesses were going to survive and thrive, and my "new paradigm" for investing in them is to look out for the ones that have garnered a near-monopoly position in a given market.

Fortunately, nowadays, if you spend any time online, they're as ubiquitous as Coca-Cola, McDonald's or Toyota are in the real world. Google and eBay are two obvious examples, and I've slotted both of those in the portfolio: Rightmove, much smaller and UK-based, is another example of this tendency to rapid concentration.

Something like 70 per cent of UK estate agents are signed up to it and most people have already used it for at least part of their research into buying a home at home. The site seems to work well. When the postcode was invented in 1959, few could have imagined its influence today. (By the way did you know that SAN TA1 is the special postcode for letters to Father Christmas?).

From the experience we have had so far, it seems that the internet is no different to the old media; once a given brand becomes synonymous with a particular market, it tends to get a stranglehold and it's very difficult to wrench business away from it. I would hope that there is someone out there in a business school right now researching this remarkable phenomenon.

After all, the internet was supposed to create vast amounts of competition, because barriers to entry - financial, technical, electronic - were relatively low. How, then, have organisations such as Google, eBay and Rightmove gained market shares that, were they in the old world, would soon attract the attention of the competition authorities?

Over a hundred years of trust-busting, everyone from Standard Oil to Microsoft has been put under pressure because of an over-dominant market position, but the internet companies have so far escaped it. It can only be because the impression of chaotic myriad competing sites is still etched into the bureaucrats' minds.

Shareholders in these new kings of the internet are laughing. I'm happy with Rightmove because this week it's up about 7 per cent on where I bought it, with the promise of more on the way. It's a great buy because, first, it capitalises massively on the changing way we buy properties, so more online browsing by postcode and less window shopping in the high street. Second, it is the subject of constant takeover rumours, which just confirms its attractiveness to me.

I read in the press that there's another broker's note now from Numis that actually cottons on to the fact that the structural changes in the property market will probably outweigh any adverse effects a housing downturn would have on the business.

One last thought. Whatever's happening to popular capitalism? Say you had a few shares in the privatised utilities and the demutualised ex-building societies; chances are that, thanks to foreign takeovers and private equity, you haven't got them any more. The wider share ownership that started in the Eighties must have gone sharply into reverse (especially with BAA disappearing). Just thought I'd pay my respects to a dream that died.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at

Approved Food sell products past their sell-by dates at discounted prices
Jonny Evans and Papiss Cisse come together
Life-changing: Simone de Beauvoir in 1947, two years before she wrote 'The Second Sex', credited as the starting point of second wave feminism
peopleHer seminal feminist polemic, The Second Sex, has been published in short-form to mark International Women's Day
Arts and Entertainment
The beat is on: Alfred Doda, Gjevat Kelmendi and Orli Shuka in ‘Hyena’
filmReview: Hyena takes corruption and sleaziness to a truly epic level
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Evening Administrator

    £8 per hour: Recruitment Genius: This Pension Specialist was established early...

    Guru Careers: Executive Assistant / PA

    £30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...

    Ashdown Group: Graduate Application Support Analyst

    £25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

    Reach Volunteering: External Finance Trustee Needed!

    Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...

    Day In a Page

    Homeless Veterans campaign: Donations hit record-breaking £1m target after £300,000 gift from Lloyds Bank

    Homeless Veterans campaign

    Donations hit record-breaking £1m target after huge gift from Lloyds Bank
    Flight MH370 a year on: Lost without a trace – but the search goes on

    Lost without a trace

    But, a year on, the search continues for Flight MH370
    Germany's spymasters left red-faced after thieves break into brand new secret service HQ and steal taps

    Germany's spy HQ springs a leak

    Thieves break into new €1.5bn complex... to steal taps
    International Women's Day 2015: Celebrating the whirlwind wit of Simone de Beauvoir

    Whirlwind wit of Simone de Beauvoir

    Simone de Beauvoir's seminal feminist polemic, 'The Second Sex', has been published in short-form for International Women's Day
    Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

    Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

    Why would I want to employ someone I’d be happy to have as my boss, asks Simon Kelner
    Confessions of a planespotter: With three Britons under arrest in the UAE, the perils have never been more apparent

    Confessions of a planespotter

    With three Britons under arrest in the UAE, the perils have never been more apparent. Sam Masters explains the appeal
    Russia's gulag museum 'makes no mention' of Stalin's atrocities

    Russia's gulag museum

    Ministry of Culture-run site 'makes no mention' of Stalin's atrocities
    The big fresh food con: Alarming truth behind the chocolate muffin that won't decay

    The big fresh food con

    Joanna Blythman reveals the alarming truth behind the chocolate muffin that won't decay
    Virginia Ironside was my landlady: What is it like to live with an agony aunt on call 24/7?

    Virginia Ironside was my landlady

    Tim Willis reveals what it's like to live with an agony aunt on call 24/7
    Paris Fashion Week 2015: The wit and wisdom of Manish Arora's exercise in high camp

    Paris Fashion Week 2015

    The wit and wisdom of Manish Arora's exercise in high camp
    8 best workout DVDs

    8 best workout DVDs

    If your 'New Year new you' regime hasn’t lasted beyond February, why not try working out from home?
    Miguel Layun interview: From the Azteca to Vicarage Road with a million followers

    From the Azteca to Vicarage Road with a million followers

    Miguel Layun is a star in Mexico where he was criticised for leaving to join Watford. But he says he sees the bigger picture
    Frank Warren column: Amir Khan ready to meet winner of Floyd Mayweather v Manny Pacquiao

    Khan ready to meet winner of Mayweather v Pacquiao

    The Bolton fighter is unlikely to take on Kell Brook with two superstar opponents on the horizon, says Frank Warren
    War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

    Baghdad fights to win back Tikrit from Isis – but then what?

    Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable
    Living with Alzheimer's: What is it really like to be diagnosed with early-onset dementia?

    What is it like to live with Alzheimer's?

    Depicting early-onset Alzheimer's, the film 'Still Alice' had a profound effect on Joy Watson, who lives with the illness. She tells Kate Hilpern how she's coped with the diagnosis