Money upset the mobile phone business which was a lazy cartel controlled by carriers, who functioned as monopsony customers of phone manufacturers. Europe's market was more dynamic than the the US and Japan due to regulation but still the phones weren't amazing. Then about a decade ago Apple blew up not just the design of phones but more importantly IMHO the relationships between the end users, manufacturers, and the carriers.

I cite this as a proof that it can happen but in general I think regulation to manage externalities is underused due to ideology. Yet as a businessperson I don't consider regulation inherently evil -- in fact, for example, a safety reg which applies to everyone doesn't disadvantage any one company.