Dear Readers,

Interoperability has long been a controversial issue in antitrust law and related regulatory disciplines.

The concept refers, essentially, to the ability for systems controlled by different operators to be compatible, and in particular to share information and function in conjunction with each other.

Interoperability can take many forms. For example, telephone systems operating on the basis of one standard must interoperate with other standards in order to allow cross-network telephone calls. Interoperable file formats allow documents made in one computer program to be opened and edited in a competing program without loss of data. Cross-border rail networks are based on the interoperability of trains due to common rail gauge standards.

It is easy to see why, in principle, these possibilities are pro-consumer and can prevent the abuse of market power by incumbent providers, by facilitating switching and preventing markets from “tipping” permanently in favor of one provider.

As such, interoperability holds an intuitive appeal. However, as networked systems become more complex, it is also clear that mandating interoperability can be a double-edged sword. At times, competition between different standards and systems can produce positive outcomes for all concerned, not least consumers.

Requiring compulsory interoperability between, for example, programs written for different computer operating systems would arguably risk undermining the incentives for the creators of operating systems to innovate unique features and capabilities within those systems. This risk must be balanced against the pro-competitive aspects of interoperability: but this is a delicate calculus that must be based on a detailed case-by-case analysis.

The pieces in this Chronicle address various aspects of this debate as it has developed throughout the history of antitrust and competition rules, and how the principles that have developed over time apply to the dilemmas facing practitioners, regulators and courts in today’s increasingly networked environment.

As always, thank you to our panel of authors.


CPI Team