Defining “Digital Platform”

[Analysis] Digital platforms that (a) provide a two-sided or multi-sided market; (b) are accessed via the internet; and (c) have at least one side that is marketed as a “mass market” service, share a set of characteristics and raise a similar set of concerns so that we should consider them as a distinct set of businesses. This does not make laws of general applicability such as antitrust inapposite. Nor are these distinct capabilities and incentives intrinsically bad or good. Identifying the nature of digital platforms and understanding the implications of this increasingly important sector of the economy is critical to understanding both how to update antitrust and other generally applicable laws, and when sector-specific regulation is required to promote the public interest. In particular, this analysis should make clear that regulation based on surface similarities is not merely unlikely to be helpful, but may be downright harmful. It is a common cliché that “if it looks like a duck and quacks like a duck, it’s a duck.” Unless, of course, it is actually a clever hunting decoy. For ducks, distinguishing between these two possibilities is rather essential. Similarly, for the formulation of good policy -- whether through updating antitrust law or applying sector-specific regulation -- understanding what makes digital platforms different is critical to protecting and promoting the public interest.

[Public Knowledge Senior Vice President Harold Feld]