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Platforms, Power, and the Antitrust Challenge: A Modest Proposal to Narrow the U.S.-Europe Divide
Abstract
Big platforms dominate the new economy landscape. Colloquially known as GAFA [Google, Amazon, Facebook, and Apple] or FAANG [Facebook, Amazon, Apple, Netflix, and Google], the high tech big data companies are charged with using the power of their platforms to squelch start-ups, appropriate rivals’ ideas, and take and commercialize the personal data of their users. Are the platforms violating the antitrust laws? Should they be broken up? Or are they the agents of progress in the new economy? On these points, the United States antitrust law and the European Union competition law may diverge. The Competition Directorate-General of the European Commission has brought proceedings against or is investigating Google, Amazon, Apple, and Facebook. Germany, under its own competition law, has condemned Facebook’s conduct. Meanwhile, in the United States, authorities are skeptical, but they have commenced investigations. This Article is a comparative analysis of U.S. and EU law regarding monopolization/abuse of dominance as background to understanding why EU law is aggressive and U.S. law may be meek in the treatment of the big tech platforms. First, it examines the factors that underlie the two perspectives. Second, it considers three cases or problems—Google/Comparative Shopping (EU), Facebook-Personal Data (Germany), and dominant platforms’ acquisitions of start-ups that are inchoate competitive threats, such as Facebook’s acquisitions of WhatsApp and Instagram. The Article considers what lessons the latest Supreme Court antitrust decision, Ohio v. American Express (AmEx), holds for the analysis of the big data antitrust issues. Third, it asks what U.S. antitrust law and enforcement should do. It concludes that U.S. antitrust law should reclaim its role as watchdog to stop abuses of economic power, and makes suggestions for U.S. antitrust law to meet the big-platform challenge in a modest but meaningful and practicable way. I. Introduction II. A Brief Comparison of U.S. and EU Law of Monopolization/Abuse of Dominance ... A. The United States ... B. Europe ... C. Presumptions and Divergences III. Implications for High Tech, Big Data IV. Three Examples of Alleged Platform Abuse ... A. Google/Comparative Shopping ... 1. EU Law ... 2. U.S. Law ... B. Facebook—Abuse of Data ... 1. German Law ... 2. U.S. Law ... C. Start-Ups: Nipping Competition in the Bud V. Proposals VI. Conclusion
... Users remain disconnected from each other, but inextricably connected to the platform to generate more profit. Due to this, centralized platform raise the issue of personal privacy, ownership of information, efficiency and data protection [21] [27]. ...
Cryptographic tokens are a new digital paradigm
that can facilitate the establishment of economic incentives in
digital ecosystems. Tokens can be leveraged for the coordination,
optimization and governance of large networks at scale in a
decentralized manner. A key aspect is their programmability,
that can reward participants relative to their stage of adoption,
according to the value they contribute and the risk they bear.
Moreover, this can be done in a transparent and verifiable way,
which increases trustworthiness in the emerging systems. This
work presents an overview of this new phenomenon and to provide
multi-disciplinary arguments on why tokenized ecosystems
can drive a huge momentum for positive-sum collaboration in the
digital age. We illustrate how certain principles and values that
arise from the evolutionary process of digital cooperation can
lead to a market economy characterized by economic efficiency
of both individuals and the tokenized ecosystem as a whole.
... Enterprise software did not receive nearly as much mainstream media attention or scrutiny as user-facing software (i.e., the "browser war" against Netscape), which further made antitrust effects harder to anticipate. As Microsoft's "home" regulator, U.S. authorities also had a wider and stronger array of remedies at their disposal than regulators elsewhere (Fox, 2019), making the case a particularly strong intervention. 7 6 In contrast, in settings like Apple's App Store or Google Play where the platform controls distribution, profit impact may be harder to assess. ...
This study examines whether “unblocking” competition through antitrust intervention against a dominant platform can spur complementor innovation in platform ecosystems. Using a novel dataset on enterprise infrastructure software and a difference‐in‐differences design, we examine the relation between the U.S. antitrust intervention against Microsoft (dominant enterprise platform) and subsequent innovation and profitability of infrastructure applications firms (complementors). The data show that innovation among complementors—particularly ones with low market share—soared when the competitive pressure on the dominant platform amplified. However, the profitability of these complementors dropped. Our results contribute to understanding links between competition and innovation in platform ecosystems, as well as the opportunities and threats related to dominant platforms in those ecosystems. Complementors (apps, services) that are owned by their platforms often have an unfair advantage. Antitrust action challenges the power of such dual platform‐complementors, reasoning that unfair advantage blocks fair competition, and, in turn, reduces firms’ incentives to innovate and thus limits consumer choice. We examine whether reducing anticompetitive barriers and platform‐complementors’ power revitalizes the platform ecosystem. Using a landmark antitrust case, we find mixed results: while complementors do innovate more, their profits go down. In particular, the low‐share complementors that bring in the most innovation are also the ones that lose the most financially, suggesting that they may have over‐relied on the platform for key assets. To develop a healthy ecosystem in the long run, platform owners may want to resist the temptation to keep complementors weak and instead help support their development to stand on their own.
... It's obvious that the U.S. and Europe hold different opinions about the Google case, and the platform antitrust issue. (Fox, 2019) first noticed the U.S.-Europe divide, by analyzing the origins of the U.S. Sherman Act and the EU competition law, the author explains the difference between the antitrust policies in these two areas. While the first priority of American courts is to improve customer welfare, the EU courts tend to make sure that the leading firms in the market are not impairing the rivals' competition. ...
Platform monopoly has attracted wide attention from politicians and the public.. The European Commission has made unremitting efforts in platform antitrust enforcement in the last decade, but together with antitrust investigations, the stock prices of platform giants like Google and Facebook keep breaking their highest points. At the end of 2020, the Chinese government also started antitrust investigations towards platform companies like Alibaba. In contrast, the stock price of Alibaba crashed and lost more than half of its market value. By analyzing their CAR, we proved that the stock performance of Alibaba is significantly worse than Google after their most serious antitrust investigations. The difference reflects investors' different expectations of the European Commission and China's antitrust enforcement. A noteworthy problem then comes out: while the Chinese government is seriously strengthening platform antitrust and putting forward reforms in platform regulation, is there any authority that is able to effectively regulate the international platform giants and maximize the welfare of their users worldwide?
This paper examines the economic impact of the Abuse of Superior Trading Position (ASTP) provision within Korea’s draft Act on Fair Intermediary Trade of Online Platforms (AFITOP). The AFITOP, proposed as part of competition law reform in the digital era, applies to large online platform operators providing intermediary services. While derived from the Monopoly Regulation and Fair Trade Act (MRFTA), the ASTP provision’s goal to protect the economically weak is secondary to the MRFTA’s primary goal of efficiency. Furthermore, the provision’s interpretative uncertainties burden enterprises, especially large ones and those exploring new business models. Including this provision in the AFITOP is likely to reduce innovation incentives among large online platform operators, and to foster enforcement bias toward the ASTP provision by the Korea Fair Trade Commission, thereby increasing inefficiency in competition law enforcement. Therefore, the ASTP provision in the AFITOP should not be introduced.
Events such as the riot at the United States Capitol and tightening constraints on the Russian public sphere have highlighted the socio-political significance of app store governance. This is dominated by Apple and Google as operators of the two largest smartphone platforms. In this article, we analyse two case studies: the removals from app stores in 2021 of the fringe American social media app Parler and of the Russian opposition app Smart Voting. On the basis of this analysis, we identify three critical limitations for app store governance at present: Apple's and Google's dominance, the substantive opacity of their respective app store guidelines, and the arbitrariness with which these guidelines are applied to specific cases. We then assess the potential efficacy of legislative proposals in the EU and US to intervene in this domain and conclude by offering some recommendations supporting more efficacious and socially responsible app store governance.
Entry defenses and potential competition doctrine have much in common. Both draw from predictions about future entry. Both demand difficult assessments of entry barriers and incentives. And both suffer from confused thinking today. This Article offers a clarifying perspective. Rather than focus on matters of litigation posture (who wins or loses if an argument is proved) we look to the type of analytical time travel being performed. Corrective entry defenses and actual potential competition theories involve exercises in forward time travel: reasoning about how future entry will impact future competition. Preventative entry defenses and perceived potential competition theories involve exercises in backward time travel: reasoning about how threats of future entry impact current competition. Grouping theories in this way reveals analytical flaws and unprincipled asymmetries in current thinking. It also exposes problems and paradoxes that beset all time travel arguments in antitrust analysis.
In conclusion, the big data platforms do pose problems that are antitrust problems. There are antitrust means to call big data to account
- Vi
- Conclusion
VI. CONCLUSION
In conclusion, the big data platforms do pose problems that are antitrust problems. There are antitrust means to call big data to account.
It is time for the United States to stop the big data antitrust abuses.