In GCR’s Digital Markets Guide, Analysis Group Authors Contribute Chapter Exploring US Platform Economics and Implications for Merger Reviews
December 8, 2021
In the inaugural edition of Global Competition Review’s Digital Markets Guide, Analysis Group Vice Presidents Juliette Caminade and Emily Cotton contributed the “United States: Platform Economics and Mergers” chapter. The authors explore the widespread debate over whether two-sided and multi-sided digital platforms have unique characteristics that warrant special consideration in antitrust analysis. With concerns over the perceived dominance of the largest technology companies becoming more prevalent, the debate has shifted to whether the same tools that have been used to gauge competitive effects for traditional businesses can be successfully and effectively adapted for digital two-sided platform business models.
To examine this question, Dr. Caminade and Ms. Cotton begin by briefly explaining the core characteristics of two-sided platforms and the concept of indirect network effects, and then discuss ways in which the characteristics of two-sided platforms inform the analysis of several topics central to merger reviews, including barriers to entry; pricing structures; market definition; competitive effects; nascent competition; and challenges in structuring effective remedies. In each section, the authors provide excerpts from case rulings, policy statements and academic literature to illustrate the different sides of the methodological debate.