Appropriability and the European Commission's Android Investigation
40 Pages Posted: 24 Apr 2016 Last revised: 10 Aug 2016
Date Written: April 20, 2016
This paper seeks to ascertain whether Google’s Android licensing terms, which are currently under scrutiny from the European Commission, should be absolved of antitrust sanctions because they increase its incentives to innovate. The paper starts by analyzing Google’s business model with regard to its Android OS. It then identifies the Commission’s main concerns. To assess Google’s behavior, the paper puts forward a framework which hinges on the concept of “appropriability”, and which antitrust authorities could use to balance ex ante incentives to innovate against the benefits from ex post competition. The paper argues that Google is simply pursuing a sensible appropriation strategy which could justify some immunity from antitrust intervention.
Keywords: Antitrust; Competition law; Innovation defense; Appropriability; Innovation
Suggested Citation: Suggested Citation