Competition
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The Platform Problem and Khan’s ‘Amazon Antitrust’: How we let Big Tech write its own rules By Thomas Heron, SS Law Introduction Lawrence Lessig, a Harvard University academic and attorney, was one of the first internet scholars to suggest that commerce could become the salient force that would come to characterise the internet. In his seminal work, ‘Code and Other Laws of Cyberspace’ (1999), Lessig’s ‘Pathetic Dot’ theory of internet regulation proposed that the law, social norms, the market, and ‘architecture’ were the four forces that would regulate the internet. While all of these would have a part to play, in Lessig’s view it would be commerce, with the help of governments, which would make the internet a place that enabled “an extraordinary kind of control.” The Problem with ‘Big Tech’ Even considering this ominous warning, Lessig probably could not have quite predicted the extreme extent to which history would vindicate him in respect of the third named force: the market. The private sector has dominated cyberspace in much the manner that Lessig thought it might. Nonetheless, it would still take two decades of dizzying levels of internet commercial growth for this to become widely apparent, beginning with the ‘dot.com boom’ in the United States and unto us still in ever more rapidly-changing forms with all the eery possibilities that the nascent ‘Metaverse’ portends. Now, having awoken to the near-intractable dominance of a handful of the ‘Big Tech’ platforms, regulators have begun to understand how difficult it will be to dismantle this “extraordinary control” that has been concentrated among these platforms. This is evidenced by the multitude of regulatory reports and legislative proposals on digital competition problems (EU Crémer Report, US House Antitrust Sub-Committee Report, and UK Furman Report, to name a few) coupled with the Federal Trade Commission’s lawsuit to break up Meta, Facebook’s parent company. The Root of the Digital Markets Problem In the view of this author, there are two predominant reasons that this has happened. The first is that regulators have been unable to apply traditional competition law tools to digital markets, owing mainly to the uniquely challenging characteristics of such markets; traditional competition law devices have been evaded by the platform business model. The second, possibly connected, reason is that government regulators have taken too lax and permissive an approach to the unchecked growth of these companies which operate globally to the strategic benefit of their domicile jurisdiction. A consistent theme across the global regulator reports on this issue is that the largest ‘Big Tech’ companies (Meta [previously ‘Facebook’], Google, Amazon, Apple) can be associated with many of the anti-competitive harms (as well as privacy and personal data protection issues) that are central to the problem of digital markets. But these Big Tech companies have grown in significance across the globe, with globally-operating US firms having the ability to reinforce the US economy’s dominance abroad. This role becomes increasingly important when facing competition from emerging markets. Dobbs, Koller, and Ramaswamy note that deregulation in China has incubated tech and e-commerce firms such as JD.com and Tencent, which rival the size of America’s original Big Tech firms. In the context of intensifying political and economic rivalry, the US has an interest in maintaining its global tech dominance over China, and firms like Google, Amazon, and Facebook contribute greatly to this effort. As some speculators predict the Chinese economy to overtake the US in size as early as 2028, the US’ position becomes even more threatened in this aspect. This is one possible reason for hitherto inactive antitrust regulation in this sector. To the degree that ‘Big Tech’ companies spread globally and assert the technological prowess of their home economy, the US
