When a handful of corporations control entire industries... that is capitalism. Capitalism isn't some self-correcting system that benefits all, its a system that supports and benefits those who make the most profit possible. When companies have less competition and more control, they're better able to make money. And thus, are better at capitalism.
This isn't capitalism failing to function, this is capitalism working as intended. The "free-market" is an illusion created on hope and delusion.