Leveraging Conducts in the Digital Economy: A Competition and Regulatory Perspective

Abstract

Without resorting to an overly simplistic statement, it remains difficult to evade the perception that the digital economy is prone to leveraging conducts directed at extending dominance between services. Navigating the internet with Google will often yield Google services at preferential placements. Similarly, Amazon might artificially favor its own retail products on Amazon Marketplace, while Meta (formerly known as Facebook) appears to be using data collected on its social networks to outcompete competitors on Facebook Marketplace. Naturally, tech companies deny bias and self-favoring, referring to misunderstandings, the evolution of the internet, or other plausible explanations. Yet, the anti-competitive effects of leveraging conducts have formed the core of recent EU antitrust investigations, such as Google Shopping and Google Android as well as vintage cases as Microsoft I. In particular, the matter of self-favoring discussed in the Google Shopping case has crystallized the concept of leveraging infringement, where a super dominant position is extended to an adjacent activity or market. Similar allegations are at the center of pending EU antitrust investigations into Facebook or Amazon. Besides whether they are liable, the relevant questions are how these companies benefit from self-favoring and leveraging and if this should raise concerns.These matters are developed in this paper.

Keywords: Big Tech, leverage, abuse, ecosystem, digital economy

JEL Classification: K21, K23, L12, L13, L22, L40, L41, L43, L44, L96