Grandstand. The next adoption of the Digital Markets Act (DMA) in Brussels and the bipartisan support [républicain et démocrate] to the American Innovation and Choice Online Act in Washington are unanimously hailed as a turning point in the regulation of GAFA (Google, Apple, Facebook, Amazon).
These two texts aim to prevent abuse of a dominant position by the major digital platforms, in particular those consisting in favoring their own products over the accesses under their control.
Basically, Google will no longer be able to favor YouTube videos over search engine queries, and Amazon will no longer be able to display its Amazon Basics range at the top of its e-commerce site.
Ridiculous fine
These texts are intended to prevent illegal practices that have flourished so far due to the difficulty of proving the shameless abuse of the platforms. It took ten years for the European Commission to condemn Google for offering Google Shopping before competing services. The fine was 2.4 billion euros. In the meantime, most of the ousted comparators have disappeared, establishing Google’s dominance in this market. On the scale of Google and the advantage obtained, the fine is derisory.
Now we want to warn. Is. But the problems of applying the new texts already promise to be ubiquitous. Which companies will be affected? Where will the boundary be between these and the others? Isn’t there a risk of seeing the GAFA claiming the inclusion of such and such a competitor? What services will be covered? How to establish evidence? What penalties should be imposed? How will they deter titans with colossal profits? Will Amazon be blamed for presenting an offer benefiting from Prime (free one-day delivery) before a product on its Marketplace that does not fall within this program? What will the consumer gain?
You have to fear a lot of procedures for very few results. To which the regulators retort that the platforms are cooperative and will self-regulate. Why haven’t they done so far! Everything in their attitude proves the contrary.
The fundamental problem comes from the structure of the industry, what in economic jargon is called “vertical integration”. As soon as they went public, Amazon, Google and Facebook used their resources to integrate upstream and downstream of their original business.
countless abuses
These points are technical and poorly understood by the general public. But, in short, they allowed Google to control mobile access with Android and online advertising with DoubleClick. It’s up to Amazon to be both a retailer, a marketplace welcoming competitors, and an ultra-competitive logistics service. And Facebook to capture customers and advertisers via WhatsApp and Instagram.
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