Make good use of "digital weapons" to solve the problem of platform economic monopoly
Industry Observation
In February of this year, the Anti-Monopoly Committee of the State Council issued the Anti-Monopoly Guidelines of the Anti-Monopoly Committee of the State Council on the Platform Economy Field, which carried out targeted and systematic regulation of platform economic monopoly issues, indicating that my country's platform anti-monopoly has entered the legal system , Standardization stage.
This is also an important epitome of the global fight against the monopoly of the platform economy.
On February 26, the Zhejiang Provincial Market Supervision Bureau officially released the platform economy digital supervision system "Zhejiang Fair Online", which was the first in the country to develop and construct a system for monopoly and improper behavior in the platform economy.
Overseas, countries are also increasing antitrust investigations into the platform economy.
In October 2020, the US Congress released the "Competition Survey in the Digital Market" report, stating that digital platforms represented by Google, Facebook, Amazon, and Apple have formed monopoly positions in their respective relevant markets.
After that, the US government and 48 states and regions filed antitrust lawsuits against Facebook, and the US Department of Justice and the multi-state prosecutors' consortium filed antitrust lawsuits against Google.
In December 2020, the European Union issued the "Digital Services Act" (DSA) and "Digital Market Act" (DMA) proposals, treating large digital platforms as gatekeepers and requiring these platforms to undertake special obligations.
On January 14, 2021, the German Bundestag passed the "Anti-Restriction of Competition Act" (GWB) digitalization bill, which provides more detailed regulations on the monopoly of digital platforms.
Data and algorithm monopoly is the main feature
The reason why anti-monopoly on platforms has become the consensus of major economies in the world is that platform monopoly is different from traditional enterprises' use of market dominance to conduct anti-competitive behaviors.
For the platform, the primary manifestation of its monopoly is data monopoly.
During the operation of the platform, a large amount of consumer-related data has been collected by providing consumers with free services.
As a major production factor of the platform, data can be used for multiple times at zero marginal cost after being collected once.
Moreover, in the process of data use, new data will be generated, thereby strengthening the monopoly advantage of the platform.
Due to the platform's data advantages, the platform can extend its business to related fields. The cross-market use of data will bring new economies of scope and form a new monopoly in this field. This is the dual-round monopoly effect of the platform.
This effect is often reflected in the field of mergers and acquisitions. After platform companies merge innovative start-ups, they use their existing data advantages and traffic advantages to rapidly increase their market share, and make the industry's small and medium-sized enterprises die out.
Another special feature of platform monopoly is algorithm monopoly.
Now platforms treat algorithms as core business secrets. For regulators, platform algorithms are equivalent to a black box.
The opacity of platform algorithms enables the platform to use algorithms to conduct anti-competitive behaviors and strengthen its monopoly position.
One of the most common algorithmic monopoly mode is to use the default settings.
Platforms that have a monopoly position can require consumers to make choices. In this process, highlighting an option with a special color or putting it first can greatly increase the probability of the option being selected by consumers.
According to reports, in order to make it the default search engine on the iPhone, Google pays $12 billion to Apple every year.
In foreign studies, the behavior of tricking consumers into using default settings is called "dark mode."
According to empirical research, extreme dark mode can increase the acceptance rate by 371%.
Algorithm monopoly will also greatly infringe the rights and interests of consumers, such as the unclear probability of online game lottery, big data, complicated online consumption promotion rules, online search bidding recommendation, online live broadcast violations of laws and regulations, public order and good customs, praise and hidden bad reviews. The evaluation results are distorted, and the platform uses algorithms to restrict transactions.
"Multi-pronged approach" should be adopted to ensure the effectiveness of governance
The new phenomenon of platform monopoly should be comprehensively treated by means of laws, policies, technology and other aspects, so as to reduce its harm.
One is to strengthen data governance.
Data is the cornerstone of platform monopoly.
From the perspective of domestic and foreign research, to solve the problem of data monopoly, it is necessary to increase efforts in promoting data portability, data interoperability, and data openness.
For example, in March 2019, the United Kingdom published the "Digital Competition Expert Committee Report", which put forward policy benchmarks to deal with competition in the digital age, with the focus on data portability.
The EU's "Digital Market Law" also emphasizes data portability.
At the same time, it is necessary to establish a data flow mechanism that balances data transactions, data sharing, and data security.
my country can refer to the EU's data portability regulations, combined with the sensitivity of data in various industries, whether data is desensitized, and data availability requirements, to guide the classification and classification of data assets, establish and improve legislation on data circulation, and regulate data circulation behavior.
Furthermore, it is necessary to standardize platform data collection and use, and standardize behaviors such as excessive data collection on the platform and unlimited data mining.
The second is to establish a dynamic monitoring mechanism for platform anti-competitive behavior.
A platform occupies most of the market share in the relevant market is a characteristic of the digital economy, which is caused by network effects, subadditivity of costs, and characteristics of data elements.
Therefore, the anti-monopoly regulations of digital platforms cannot be regulated based on their market share.
Instead, it should focus on dynamic supervision of its behavior, the core of which is to pay attention to whether it has disrupted competition and harmed consumer welfare.
Due to the complexity of the platform algorithm, advanced technology needs to be introduced in the supervision process.
For example, the aforementioned "Zhejiang Fair Online" uses big data, artificial intelligence and other technologies to realize digital supervision of online transactions, which can realize dynamic real-time monitoring of platform anti-competitive behavior.
The third is to strengthen the governance of platform algorithms.
Algorithm is an important factor of platform monopoly. First of all, we must clarify the consistency requirements of algorithm application results.
Including the necessary public options for the results presented when searching for different users, the pricing algorithm must ensure that all users are consistent, and cannot adopt discriminatory or personalized pricing.
The platform should enhance the transparency of the algorithm, and the application of the algorithm should be verifiable, explainable, and accountable.
The fourth is to conduct key supervision on mergers and acquisitions of platforms with dominant market positions.
Through mergers and acquisitions, the platform uses leverage to integrate across markets, thereby strengthening its monopoly advantage in multiple rounds.
Therefore, it is necessary to strengthen the review of platform mergers and acquisitions in accordance with the guidelines.
(The author is a researcher at the Chinese Academy of Social Sciences Institute of Financial Strategy)