There are two elements to a violation of the statute: First, the alleged monopolist must have monopoly power (or a dangerous probability of obtaining such power); second, the monopolist must have obtained or maintained that power "willfully"--namely, by predatory or exclusionary acts. The first element of a violation is typically established by proving that the alleged monopolist has at least a 70-percent share of an economically defined relevant market--all those products or services that are economic substitutes for the putative monopolist's product or service. Even if a firm has a large share of the market, it still may not have monopoly power if entry is easy or if the market is so dynamic that large shares are ephemeral.

The second element of a monopolization claim requires that the monopolist have engaged in impermissible conduct. While a monopolist can compete vigorously to attract customers, it cannot engage in acts that exclude or drive competitors from the market and that have no legitimate justification. So for example, a monopolist that has lower costs than any rival can cut its margins and lower its prices down to (but not below) its costs. But if the monopolist cuts its prices below its costs in the realistic expectation of driving competitors out of the market and recouping its losses by raising prices, that is illegal "predatory pricing." Similarly, while monopolists can try to develop efficient distribution arrangements with third parties, it would probably violate the Sherman Act if a company systematically signed up all the efficient distributors to exclusive arrangements and deprived actual or potential competitors of any distribution outlet for their products.

It is important to keep in mind that there is no violation unless both the monopoly power and conduct elements are established. If a firm has no monopoly power, then unilateral bad acts do not violate the antitrust laws. Conversely, if a firm has monopoly "thrust upon it" (i.e., through luck, skill, or foresight, and not through bad acts), it will not be punished for its success or for continuing to compete aggressively. That is the law.