Protecting Competition in a Digital World
It is no accident that the five largest companies in the world are all platform firms that have secured key positions as gatekeepers for large areas of the digital economy. To ensure that consumers benefit from free and fair market competition, antitrust authorities must stay ahead of the curve in this rapidly changing domain.
BONN – Digital technology continues to transform much of the global economy. The combination of Big Data, increases in computing power, and cloud-based systems has generated new services, and is rapidly changing existing industries. Platforms connecting different user groups have brought online search, social media, and e-commerce to consumers around the world.
Owing to their reach, scale, and enormous growth, some of these platforms have become digital gatekeepers for the services they offer, and this has afforded them exclusive access to certain user groups. The payoffs from such practices are clear: the five largest companies in the world by market value – Microsoft, Amazon, Apple, Alphabet (Google) and Facebook – are all digital firms.
Competition law entrusts antitrust authorities with the task of keeping markets open to competition. It seeks to limit the economic power of individual companies in order to ensure choice for consumers. If a dominant company acts as a digital gatekeeper and abuses its power, competition authorities should intervene to ensure contestability and protect consumers.
We hope you're enjoying Project Syndicate.
To continue reading, subscribe now.
Get unlimited access to PS premium content, including in-depth commentaries, book reviews, exclusive interviews, On Point, the Big Picture, the PS Archive, and our annual year-ahead magazine.
Already have an account or want to create one to read two commentaries for free? Log in