Anticompetitive Product Design in the New Economy

Abstract

Claims alleging anticompetitive product design and redesign lie at the very core of one of antitrust law’s most challenging dilemmas: the intersection between innovation and regulation, invention and intervention. For over three decades, courts and scholars have struggled to determine the proper analytical framework within which to address such cases. Meanwhile, the very industries in which challenged conduct occurs have been undergoing fundamental changes.

As demonstrated by the ongoing and recent antitrust litigation involving high-technology firms Apple, Intel, and Microsoft, distinctive features characterize most product markets in what has been called the “New Economy” - and increasingly has become simply “the economy.” Many of these features not only uniquely incentivize anticompetitive design-related conduct, but also render such conduct uniquely susceptible to antitrust scrutiny. Accordingly, this Article both supplies a proper understanding of code-based product markets and, perhaps more importantly, provides a structured, efficient, and rational method of analyzing design-related conduct in those markets.

Keywords: antitrust, product design, anticompetitive, Apple iPod, iTunes, litigation, computer programming, computer code, product market law and economics

JEL Classification: K21, L12, L41, L63, D42