Near perfect market intelligence

Jesse Hirsh

easyDNS is pleased to sponsor Jesse Hirsh‘s “Future Fibre / Future Tools” segments of his new email list, Metaviews

Has the antitrust day of reckoning arrived?

 

This week the US Congress released their long anticipated report on competition in the digital marketplace. It is the result of an extensive investigation into the digital monopolies, and foreshadows a potentially significant shift in antitrust law, which could radically alter and reconfigure our digital world.

We’ve written a few issues about antitrust, and the hearings that led up to this report. I also wrote about those hearings for CIGI. In that article I argued that the pandemic has set the stage of antitrust action as it emphasized the outsized role that these digital monopolies play in our lives.

The release of this report is very much timed to coincide with the upcoming US election, and create a contrast between the incumbent and the challenger.

Although given that the challenger was part of the previous regime, this report is not particularly partisan, and condemns the Obama administrations lack of antitrust action as much as the current.

Simply put, it argues that regulators and officials were either asleep on the job or complicit in the abuse of market position and enabling the rise of these digital monopolies.


In this context the report is both harsh and fair, and calls for actions that are significant and reasonable.

As an investigation it is incredibly thorough, and provides glimpses into these digital monopolies that were previously only available to insiders.

However one of the characteristics or abilities of the digital monopolies noted in the report was the concept of “near-perfect market intelligence”. This is part of what makes contemporary digital monopolies so powerful, their surveillance and data collection capabilities provide them with a view of the marketplace that makes it possible for them to reinforce and maintain their monopoly positions.

While the phrase is used in the context of Google’s practices, the metaphor applies to all four of the companies included in this investigation.

Specifically it helps frame why action against these monopolies is necessary, as their privileged view of the marketplace not only makes it difficult for any challenger to take them on, but also gives them the opportunity to buy said challenger, before they’re able to mount an effective challenge!?

Although there are many who dispute this, and argue that the likes of Shopify and TikTok demonstrate that these digital platforms are more vulnerable than we might think.

However that kind of thinking does not defer the authors of this report, who are calling for significant action against the digital monopolies and major reform of antitrust laws and regulations.

The potential breakup of these companies is monumental. That it is what this report is clearly calling for not only gives it momentum, but sets 2021 as a significant showdown between big tech and the US congress. Especially if the current POTUS is no longer in office.

Although that’s not to say there is a general consensus on breaking up big tech.

Congressman Buck published a minority report, which while it disagrees with some aspects of the Cicilline report, also demonstrates there’s desire for action from both parties.

It is rare that these two parties are able to find common ground, and in this case it may be a result of the power that the digital platforms have. Depending on how the upcoming election plays out, there’s lots of opportunity for bipartisan solutions.

Part of the reason Republicans are interested in curbing the power of digital platforms is their legitimate concern that these companies exercise too much control over speech and expression.

Of course the irony of antitrust action is that it happens at a glacial pace while the digital platforms evolve and adapt at the speed of the web. That will be the real challenge moving forward.

While this report was an impressive investigative feat, that at the very least demonstrates that the US Congress “gets it” and understands the nature of this current threat. Whether they can do something about it remains a larger question, both due to the ongoing distraction that is the executive branch, and the power the digital platforms have when it comes to mobilizing public opinion and support.

Moving forward what will influence the direction and outcome of this extended antitrust battle will be the role of civil society, which does include industry. On the one hand that means TikTok, Shopfiy, WeChat, and others, who could on their own displace or at least challenge the incumbents. However on the other hand it also involves the battle of ideas and the attempt to win the hearts and minds of the public and the officials they elect to represent them.

While many proponents of antitrust action are enthused and encouraged by this report, expecting the new year to bring new legislation and action, I remain skeptical. Increasingly the danger that experts and advocates find themselves in, is believing that their echo chamber is reflective of the world outside of it. Especially when the echo chamber is enabled and controlled by the parties they seek to regulate and break-up.

It’s one thing to talk about near-perfect market intelligence. Defeating it or countering it may not be as easy.

Related Posts

Society as a Potemkin Village

If I were to create a word cloud of the thoughts I had this past year, a big (and recurring) phrase would be Potemkin Village or at least Potemkin. I tried throwing the phrase or name into Twitter to see what comes up and the results were far too many and sprawling to be of much use. Although this could also be a reflection of the algorithm’s inability to grasp the significance of the phrase.

Future Tools: ProtonMail

Writing this newsletter has rekindled my appreciation if not affection for email. As more of our world becomes mediated by algorithms, it is refreshing to be able to revert to a protocol that is far more accessible and resilient.

Data is never neutral

The consequence of believing in the myth that data (or AI) is neutral, is that it discourages people from asking what agenda that data serves, or what biases it may have. This kind of critical thinking is essential in a world of automated decision making in which that data is used to judge us and govern our working lives.

Leave a Reply

Your email address will not be published. Required fields are marked *