Big tech companies have brought the 21st century some of its greatest innovations. Amazon.com Inc, Google search, Apple Inc’s iPhone and other digital products have made people’s lives immensely more convenient and productive — a consumer benefit worth, by one estimate, more than US$2.5 trillion a year. They deservedly dominate their respective markets.
It is true that such dominance can at some point threaten competition. Increasingly, EU officials are taking it upon themselves to decide where that line should be drawn. They should take care not to merely punish success, and remember that red tape often does more harm than good.
To an extent, the tech giants would be remiss not to exploit their scale. Amazon runs the world’s largest online marketplace, so why not sell its products, too? App developers want to reach the iPhone’s 1.5 billion users, so why not connect them through a proprietary app store and payment system? Google handles 90 percent of Web searches; offering services such as comparison shopping surely makes sense. For consumers, the result is often a simpler and more seamless experience.
Yet it is easy to cross a line. With its control of data and search results, Amazon might treat the small retailers that depend on it unfairly. Apple and Google can relegate competitors to the back of the app store or to the end of the search results. All have ample resources to co-opt innovative challengers. If anticompetitive conduct is not addressed, the result for consumers could be limited choice, worse products or unduly high prices. For the economy, ossification.
The goal, then, should be discouraging anticompetitive conduct — not trying to micromanage businesses or dictate how a given industry should develop.
The traditional approach, antitrust enforcement, is a slow-motion bludgeon. For example, the US Department of Justice landmark lawsuit against Google concerns practices that began decades ago and have long since cemented the company’s dominance in search. All too often, remedies fail or even do damage.
The EU believes it has a better way. Its Digital Markets Act sets broad rules of fair play, seeking to head off anticompetitive behavior in something closer to real time. Much would depend on how regulators apply the vast powers it grants them — including fines that can amount to one-fifth of a company’s global revenue. The burden is on them to prove that the law is not merely a stealth tariff on big US tech firms (which it targets as “gatekeepers”), and that they genuinely have the interests of consumers and innovators in mind. Unduly meddlesome regulation could prove disastrous for Europe’s competitiveness.
The evidence so far is not great. Thanks to the Digital Markets Act, which took effect in March, EU consumers have easier access to some apps and Web browsers on their smartphones — although to what extent they really want or would use that choice is an open question. At the same time, they would miss out on new AI features from Apple and Meta Platforms Inc, which have blamed delays on regulatory uncertainty. One must hope EU officials learned something from their 2016 General Data Protection Regulation, which has subjected people to endless online cookie-consent menus while harming investment, innovation and firm performance.
It is an experiment worth watching. Jurisdictions from the US to Japan are considering legislation similar to the EU’s. If Europe’s regulators would rather produce a model than a cautionary tale, they would do well to follow a simple maxim: If it would not make people better off, do not do it.
The Editorial Board publishes the views of the editors across a range of national and global affairs.
US President Donald Trump and Chinese President Xi Jinping (習近平) were born under the sign of Gemini. Geminis are known for their intelligence, creativity, adaptability and flexibility. It is unlikely, then, that the trade conflict between the US and China would escalate into a catastrophic collision. It is more probable that both sides would seek a way to de-escalate, paving the way for a Trump-Xi summit that allows the global economy some breathing room. Practically speaking, China and the US have vulnerabilities, and a prolonged trade war would be damaging for both. In the US, the electoral system means that public opinion
They did it again. For the whole world to see: an image of a Taiwan flag crushed by an industrial press, and the horrifying warning that “it’s closer than you think.” All with the seal of authenticity that only a reputable international media outlet can give. The Economist turned what looks like a pastiche of a poster for a grim horror movie into a truth everyone can digest, accept, and use to support exactly the opinion China wants you to have: It is over and done, Taiwan is doomed. Four years after inaccurately naming Taiwan the most dangerous place on
Wherever one looks, the United States is ceding ground to China. From foreign aid to foreign trade, and from reorganizations to organizational guidance, the Trump administration has embarked on a stunning effort to hobble itself in grappling with what his own secretary of state calls “the most potent and dangerous near-peer adversary this nation has ever confronted.” The problems start at the Department of State. Secretary of State Marco Rubio has asserted that “it’s not normal for the world to simply have a unipolar power” and that the world has returned to multipolarity, with “multi-great powers in different parts of the
President William Lai (賴清德) recently attended an event in Taipei marking the end of World War II in Europe, emphasizing in his speech: “Using force to invade another country is an unjust act and will ultimately fail.” In just a few words, he captured the core values of the postwar international order and reminded us again: History is not just for reflection, but serves as a warning for the present. From a broad historical perspective, his statement carries weight. For centuries, international relations operated under the law of the jungle — where the strong dominated and the weak were constrained. That
RSS