Policy --- Regulating Platforms & Ecosystems
My recent interest in the evolution of digital platforms and ecosystems has rekindled my interest in regulation.
Existing tools in economics are unaccustomed to looking at business models, or explicitly considering how firms benefit by shaping the environment around them. That leaves an important gap in terms of their analysis of the competitive implications of, say, the growth of new tech-based giants.
The power of big tech firms does not come from their tech prowess alone; it comes from their ability to change industries.
Leading tech firms can impose ecosystem structures that benefit them and shape the terms of trade with powerless complementors and partners. This opens up an exciting new avenue for us to revisit how we should approach regulation and antitrust.
I believe we should focus on ecosystem failures, not only market failures.
This interest has led me to engage with the regulatory community. For instance, along with Luigi Zingales, an academic commentator in the recent BRICS competition meeting in Moscow. I’ve since been involved in the regulatory discussions in the EU, but also in the US, e.g. through the written testimony submitted to the Senate Judiciary sub-committee on Competition Policy, Antitrust and Consumer Rights on mobile App Competition in April, 2021.
I am also increasingly involved in helping bridge regulatory authorities, especially in Europe, with work that provides a more robust basis to understand the challenges in digital environments, especially given the prevalence of platforms and ecosystems.
As such, in February 2020 I co-organized a workshop on Regulating Platforms and Ecosystems along with Prof. Yiannis Lianos, Chair, Global Competition Law and Public Policy and Director, Centre for Law, Economics and Society of UCL, and the World Economic Forum’s Digital Initiative. We had five heads of European Competition Authorities and the Chair of the OECD Competition Group, but also customer advocate representatives, antitrust judges, and executives such as Facebook’s Director for Economic Policy, and thought leaders in the space such as Marco Iansiti, Geoff Parker and Annabelle Gawer. This well-received workshop will pave the way for significant new work, including a Special Section of the journal I co-edit, Industrial and Corporate Change, with leading contributors on this cutting-edge topic.
Yiannis Lianos (President of Greece’s Competition Commission) and I have written an ICC paper on regulating ecosystems in theory and practice, and we have collaborated on policy as well. I was a pro bono member of the Law Preparation Committee of Greece’s new Antitrust Law and am the Hellenic Competition Commission’s Chief Expert Advisor on the Digital Economy.
Finally, with Evolution Ltd, I also apply this work as it relates to particular firms and their ecosystem challenges. It’s been fascinating to work with some of the worlds’ top tech and platform firms and advisories, and bridge theory and practice. Some of this work has resulted to the White Paper I wrote with my EvolutionLtd colleagues (including a former EU Innovation Minister and McKinsey Senior Partner) on how Big Tech regulation and the EU’s Digital Markets Act will reshape the competitive and strategic context.
Ongoing work includes focusing on a fascinating context- the Artificial Intelligence ecosystem. In a paper in Strategy Science, ETHZ’s Stefano Brusoni, BCG’s Francois Candelon and I explore the evolutionary dynamics of the AI ecosystem, and its implications for strategy and policy.