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How Businesses Should Brace for Looming Digital Competition Policies

June 20, 2019
Scott Morrison

With high-profile players calling for the breakup of tech giants, organizations need to be ready—while delivering the best digital experiences to customers.

“It’s time to break up Facebook” reads the headline for a recent op-ed in the New York Times—a piece authored by, of all people, Chris Hughes, a cofounder of Facebook.

Hughes isn’t the only high-profile player calling for regulation around digital competition. Working on commission from the UK government, the Digital Competition Expert Panel (DCEP) released a report in March proposing a series of measures aimed at sustaining and promoting competition in digital markets. In June, the Competition and Markets Authority (CMA) put out a call for information and sponsored a report on ex-post assessment of mergers in the digital sector. The European Commission also released a report on the subject this year. 

These reports outline a range of potential policy solutions to address the so-called “winner takes all” outcome—a result of network effects, low marginal costs and access to data—that makes it increasingly difficult for new firms to enter digital markets at scale. Yet while these policies (and their justifications) are well documented in the reports, less so are the challenges inherent in regulating this space, an understanding of what might realistically happen and how, given the lay of the land, businesses should best prepare.

Because no matter the specific policies, an increased regulatory focus on digital markets is inevitable. Now is the time to get these discussions off the ground within your organization—if you wait too long, it might be too late.

Read the full article in ThinkSet.

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