Competition in The Digital Economy How To Assess Emerging Tech Markets?

As our economy evolves, so must our application of the competition laws to be able to ‘catch up’ with the market. A highly competitive environment would thrive on inclusive growth, is key for innovation and technological change, and this environment is what pushes companies to constantly innovate. It is true that Competition laws were always applied to new businesses replacing old, however, today they are applied to a new platform as we move from ‘brick’ to the ‘cloud’. Although Competition assessment factors in market changes, the fundamental issue in the digital economy is how network effects may impact the relative market power of disruptive technology business model as people make choices on the online platform. We begin our analysis by raising questions on why there may be a need to renew market assessment tools to reconcile with the new digital economy. In the absence of a specific regulator, presently, CCI (Competition Commission of India) will have to be what FTC (Federal Trade Commission) has become – the “de facto regulator of Internet commerce”. This paper throws light on the debate going on around the world over the application of competition law rules to hi-tech markets in today’s new digital/ information economy. The author argues that it is important for the government to help assure that the industry will be shaped, during its current malleable phase, along with competitive lines. Undoubtedly, vibrant competition is a pre-requisite for enduring economic success. It would be ironical if competition authorities inhibit innovation while pursuing their objectives of accelerating growth and competition.