The DOJ’s Assistant Attorney General Jonathan Kanter is pushing for a tougher interpretation of US antitrust law. Kanter wants new laws to meet the requirements of a new digital economy, reported The New York Post.
Jonathan Kanter said US regulators had previously taken a “whack-a-mole” approach to monopolistic behavior by big tech companies. “No one ever really wins that game — the moles just keep coming,” Kanter said. “To stop them from popping up, you really need to unplug the machine. In the same way, enforcers need to unplug the monopolization machine in digital platform industries.”
Kanter said the DOJ is rethinking its reliance on enforcement based on horizontal or vertical merger status. (Buying a company in a new category is a vertical deal, such as AT&T’s one-time acquisition of WarnerMedia, whereas a horizontal merger, like T-Mobile and Sprint’s recently rejected merger, fuse direct competitors.)
For instance, Susan Athey, the DOJ Antitrust Division’s chief economist, recently co-authored a paper about the potential competition issues if a major platform were to acquire a multi-homing service, he said. People use multi-homing services to switch back and forth between multiple platforms from one centralized system or to manage accounts across multiple platforms simultaneously. If one monopolist acquired the tech, it could be a powerful tool to prevent competition even though it would be a vertical merger – which the DOJ historically interprets as kosher.
“We have been too limited by a self-imposed requirement that we use our most powerful microscopes to examine an exclusionary act before intervening to stop it,” Kanter said. “We need a wider lens, and a greater willingness to pursue and remedy all of the harmful behaviors that make up an exclusionary course of conduct.”
Rather than simply cracking down on horizontal mergers and letting vertical deals slide by, he said that antitrust enforcers should think more about how a deal or acquisition create “a flywheel effect” that reinforces a monopoly.
Kanter also emphasized how digital platforms rely on collaboration and user engagement. They aren’t installing physical networks of nationwide cables and telephone poles, as with former monopoly investigations.
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