Antitrust in Digital Markets

56 Pages Posted: 13 Jul 2018 Last revised: 22 May 2019

See all articles by John M. Newman

John M. Newman

University of Miami - School of Law

Date Written: June 22, 2018

Abstract

Antitrust law has largely failed to address the challenges posed by digital markets. At the turn of the millennium, the antitrust enterprise engaged in intense debate over whether antitrust doctrine, much of it developed during a bygone era of smokestack industries, could or should evolve to address digital markets. Eventually, a consensus emerged: although the basic doctrine is supple enough to apply to new technologies, courts and enforcers should adopt a defendant-friendly, hands-off approach.

But this pro-defendant position is deeply—and dangerously—flawed. Economic theory, empirical research, and extant judicial and regulatory authority all contradict the prevailing views regarding power, conduct, and efficiencies in digital markets. Far from being self-correcting, digital markets facilitate the creation and maintenance of uniquely durable market power. Digital markets are conducive to complex anticompetitive strategies that have largely escaped regulatory scrutiny. Perhaps most importantly, digital-market conduct tends to lack significant offsetting efficiencies.

As a result, the consensus view is ripe for rejection. Digital markets do require a different approach, but it must be uniquely interventionist, not unusually laissez faire. This Article concludes by offering a set of doctrinal and policy proposals aimed at creating a more robust, vigilant, and welfare-enhancing digital antitrust enterprise.

Keywords: digital antitrust, Silicon Valley antitrust, Google, Facebook, Amazon, YouTube, error cost analysis

Suggested Citation

Newman, John M., Antitrust in Digital Markets (June 22, 2018). Vanderbilt Law Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3201004 or http://dx.doi.org/10.2139/ssrn.3201004

John M. Newman (Contact Author)

University of Miami - School of Law ( email )

P.O. Box 248087
Coral Gables, FL 33146
United States

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