Product Market Definition in Online Search and Advertising

Competition Law Review (2013)

19 Pages Posted: 12 Oct 2013

See all articles by Nicolo Zingales

Nicolo Zingales

Fundação Getulio Vargas (FGV); Tilburg Law and Economics Center (TILEC); Tilburg University - Tilburg Institute for Law, Technology, and Society (TILT); Stanford University - Stanford Law School Center for Internet and Society

Date Written: October 11, 2013

Abstract

One of the thorniest questions which competition authorities are increasingly confronted with is the extent to which traditional market definition tools can be used to assess the competitive dynamics of today’s knowledge-intensive, user-based internet search business. The question is challenging for two main reasons: (1) the peculiarities of two-sided markets; and (2) the key role of user data in online search and advertising. This article addresses these issues individually: starting from a description of the interrelationship between online search and advertising, it highlights the role of user data as the most valuable asset for future growth in the industry, a potential barrier to entry and a cause of switching cost. Finally, it concludes with suggestions for product market definition.

Suggested Citation

Zingales, Nicolo, Product Market Definition in Online Search and Advertising (October 11, 2013). Competition Law Review (2013). Available at SSRN: https://ssrn.com/abstract=2338997 or http://dx.doi.org/10.2139/ssrn.2338997

Nicolo Zingales (Contact Author)

Fundação Getulio Vargas (FGV) ( email )

Praia de Botafogo 190
Rio de Janeiro, 22250-900
Brazil

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Tilburg University - Tilburg Institute for Law, Technology, and Society (TILT) ( email )

P.O.Box 90153
Prof. Cobbenhagenlaan 221
Tilburg, 5037
Netherlands

Stanford University - Stanford Law School Center for Internet and Society ( email )

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Stanford, CA 94305-8610
United States

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