Competition law ‘not fit for purpose’
A British thinktank has issued proposals for a radical overhaul of regulation of the technology sector, which it argues is “unfit for purpose, incentivises bad behaviour and has failed to address ethical questions about big data and its use”. In the report, “Technopoly” and what to do about it: Reform, redress and regulation, ResPublica considers that “something has gone wrong with our markets and our competition law” and uses colourful language in saying that “monopolies are an evil that restrict ownership and trade... It is not too extreme to say that we increasingly risk re-feudalising society, where ownership in any substantial degree has become an unrealisable dream for too many. This rentier society has created a new digital road to serfdom and unless or until we chart a different path, we risk recreating the market dynamics of the middle rather than the modern age.” The two authors, who include IIC board member Tim Cowen, make their case with the technology and media markets but highlight higher levels of concentration across a range of industries. Among their arguments: current competition law is not fit for purpose; regulators follow pro-monopoly standards; consumer choice and innovation should be the new norm, not just consumer welfare; and competition law needs to stop privileging big business and focus on the benefits of small businesses and market structure. They also say that social media is media, and should be regulated in the same way as traditional media, and current merger controls should be changed to meet the challenges of the digital age. The report addresses the issues from UK and European perspectives noting that concerns so far have been mainly based on data from the US. Meanwhile a report by the Hamilton Project in the US takes a similar line. In “The state of competition and dynamism: Facts about concentration, start-ups, and related policies” the authors say: “Over the past few decades there have been troubling indications that dynamism and competition in the US economy have declined.” Read ResPublic here and Hamilton here.
- Monday, 23 July 2018