7.1 Digital Markets and the Challenges They Pose to Competition Law

The platform economy broke antitrust's assumptions: | Classic assumption | Digital reality | |---|---| | Zero price = no market | Free services paid in attention and data | | Small share = no power | Network effects: small share, total lock-in | | Entry disciplines incumbents | Entry barriers: data, ecosystems, default positions | | Price is the harm metric | Quality, privacy, innovation the metrics | | One market at a time | Ecosystems leaping market to market | The challenges: multi-sided platforms (subsidizing one side, monetizing the other — the zero- price side's very definition); network effects (the winner-take-most dynamic); data advantages (the feedback flywheel: more users → more data → better service → more users); default positions (the pre-installed, the pre-selected); and acquisition strategy (buying nascent rivals — the killer-acquisition file). The institutional answers worldwide: new digital-market acts (ex-ante codes for gatekeepers — the DMA model), specialised digital-market units, and the revived structural-remedy appetite (breakup theories returning after decades).