Wettbewerbspolitischer Handlungsbedarf bei der Verknüpfung von zweiseitigen Märkten im Internet: Der Fall Google
[Competition policy and vertical integration in internet-based two-sided markets: the Google case]
AbstractWe discuss competition effects and possible regulation of vertical integration in internet-based two-sided markets against the background of the ongoing antitrust allegations against Google. In such markets, network effects and economics of scale often lead to dominating companies which are integrated over several markets. Although implying efficiency gains, the (dynamic) network effects and economics of scale may also create significant barriers to entry. These barriers of entry can be lowered if entrants can appropriate (parts of) the dynamic effects accumulated by the incumbents. At the same time, such externalities reduce incentives to invest in dynamic effects in the first place. Measures by firms that deter multi homing, increase switching costs or create incompatibilities are anti-competitive and should thus be prohibited. Systematic top listing of own products in the search results can leverage market power and reduce competition. However, there is yet no appropriate economic theory on the power’ of search engines. The often used concept of ‘search neutrality’ is not convincing.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 43326.
Date of creation: 18 Dec 2012
Date of revision:
two-sided markets; Internet; Google; market power; competition policy;
Other versions of this item:
- Sebastian von Engelhardt & Andreas Freytag & Volker Köllmann, 2013. "Wettbewerbspolitischer Handlungsbedarf bei der Verknüpfung von zweiseitigen Märkten im Internet: Der Fall Google," Zeitschrift fuer Wirtschaftspolitik, Institut fuer Wirtschaftspolitik an der Universitaet zu Koeln, Institut fuer Wirtschaftspolitik an der Universitaet zu Koeln, vol. 62(3), pages 311-332.
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts
- L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
- L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-01-07 (All new papers)
- NEP-COM-2013-01-07 (Industrial Competition)
- NEP-GER-2013-01-07 (German Papers)
- NEP-ICT-2013-01-07 (Information & Communication Technologies)
- NEP-NET-2013-01-07 (Network Economics)
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