competition law


I probably learned more useful things from working as a lowly assistant for an expert witness in US v AT&T, than from my formal education. So I was all agog when the next big anti-trust case came up, US v Microsoft. But that was also when I began to realize the need rethink of the core concepts. This article in Medium (I hope it will not be paywalled) makes an insightful comparison between the tying arguments that were central the Microsoft case and the loose claims of monopoly being bandied about in relation to Facebook now. While some of the questions and concerns echoed those the senators had two decades ago, Microsoft and Facebook’s situation could not be more different.
Firms have always had an interest maintaining the loyalty of their customers. This has also involved knowing more about the customers. In a discussion of subscription models, the Economist, refers to what may happen because of restriction on data that may emerge because of the Cambridge Analytica imbroglio. Subscription models are becoming more popular, in part because technology has made it easier to rent rather than own assets. Instead of buying software, for example, users can get access to it as a cloud-based service.
LIRNEasia Senior Research Fellow Payal Malik has written a thoughtful op-ed about how and when regulatory action is required in an economy that is does not assign centrality to static consumer surplus. Shall the choice of competition rules in India be also guided by some ideological underpinnings or there are some bright line rules that can guide regulatory philosophy? The normative basis of regulating the digital economy will finally depend on what ideology the Indian regulatory governance subscribes to. If it considers concentrated markets, by their very nature, to be undesirable, then an interventionist approach would be adopted and competition rules would impose visions of an ideal market upon economic agents. But if the regulators ascribe to a dynamic view of competition, concentrated markets will have to be traded off for consumer benefit.
As LIRNEasia Senior Research Fellow, Payal Malik has made significant contributions to Indian telecom policy and regulation over the years. She also brings to bear a unique perspective because of her experience in implementing competition law. Going beyond the emotive, she has co-authored a thoughtful op-ed that all who engage in the net neutrality debate in India should pay attention to. India’s antitrust regime empowers the Competition Commission of India to block business activities that harm consumer welfare, restrict consumer choice or deny market access. Such enforcement with a precise enforcement mandate, exclusively targeting objectionable activities, while leaving other pro-competitive conduct that benefits consumers unregulated.
Many are aware that Android, the open source operating system that open for anyone to use, is now the leading smartphone OS. Two search engine providers in Korea appear to think this has shut them out of the exploding smartphone market. In its complaint, NHN said that Google, “through a marketing partnership with major smartphone producers,” had unfairly created “a new ecosystem” by offering the Android system free as a way to control the market. Google denied the accusations, saying in a statement that “carrier partners are free to decide which applications and services to include on their Android phones.” South Korean consumers are famous as early adopters, and most new phone buyers here are opting for smartphones.
Much of modern telecom regulation is about preventing the extension of market power for oligopolistic markets to relatively competitive markets. One method used to do this is bundling two products, one from the former and the other from the latter. Conventional antitrust envisaged both the products being sold for a price, or of one being given “free” with the other. In the case of the flurry of competition-law proceedings around Microsoft, one issue was the bundling of the Explorer browser (available for free download) with the Windows operating system. Finally the consumers are being given an explicit choice at the behest of the European Commission, and they are taking it.
It started with something innocuous. Within a very short period of around a week all the mobile operators in Pakistan announced they would charge 10 Paise for balance inquiries. The Competition Commission of Pakistan naturally initiated an inquiry. The mobile operators said there was no price fixing and that this move was intended to reduce the overuse of this service. But then someone turned up with copies of emails showing the existence of a CEO Forum and details on discussions of prices, not only for balance inquiries, but for other services as well.
Indonesia’s largest telecommunications company, Telekomunikasi Indonesia (Telkom), said Wednesday it has asked unit Telkomsel to appeal a ruling that Telkomsel has broken the anti-monopoly law.Indonesia’s competition watchdog (KPPU) ruled on Monday that Telkomsel, the largest cellphone carrier here, has broken the competition law. The KPPU fined it 25 billion rupiah (2.7 million dollars) and ordered Telkomsel to lower its tariff by a minimum of 15 percent. “As the majority and controlling shareholder of Telkomsel, Telkom has requested Telkomsel to immediately carry out a legal review in accordance with its own internal processes and governance practices,” Telkom said.