DigFaSt is stage one of the ECOANTITRUST initiative, which looks for conceptual and methodological inspirations from natural ecosystems to inform policy tools for the digital economy.
DigFaSt analyzes the evolution of antitrust regulation in the era of digitalization and the role of ecological insights in shaping the conduct of digital platform orchestrators.
Advancements in communication technology have allowed digital platforms to disrupt markets and create new industries online. The ability of digital media to connect interest groups, mobilize capital, and generate new workforce opportunities has resulted in their remarkable success worldwide. However, orchestrators of these platforms have also accumulated monopolistic market power and circumvented regulatory scrutiny. The highly interconnected nature of digital platforms means regulators can no longer rely on conventional regulatory tools applied to pipeline businesses.
Traditionally, the term ‘ecosystem’ describes a community of organisms or biological entities interacting with each other and their environment in an indeterministic and complex system. More recently, digital platforms have been characterized as ecosystems, and subsequently, their strategies and actions have been rationalized using anecdotes from natural sciences. Are such characterizations based on uncritical metaphors, or are digital platforms truly resonant with natural ecosystems? And if so, can competition authorities become beneficiaries of such ecological insights to improve their own regulatory toolkits in the era of digital platform dominance?
DigFaSt is the first phase of the ECOANTITRUST initiative. It seeks to investigate the prominence of digital platforms and understand the influence of ecological metaphors in shaping perceptions around their conduct. The project aims to determine whether digital platforms can be regarded as complex ecosystems and the potential inspirations this could provide for antitrust regulators to overcome their existing knowledge gaps. The interdisciplinary team at IIASA and our partner institutes conduct thorough qualitative research into the fundamental links between digital platforms and natural ecosystems. Our contribution aims to advance a transformation into the way we perceive these platforms and thus eliminate any regulatory blind spots. In collaboration with the BRICS Competition Law and Policy Center, our objectives are:
1. To reflect on the proliferation of digital platforms and the challenges faced by antitrust authorities to regulate digital markets in the era of platformization.
2. To observe the characteristics which have benefitted incumbent digital platforms, including modularity of products, rapid attainment of network effects, positive feedback loops between multiple user groups, and the creation of non-linear supply chains.
3. To investigate how ecological metaphors have shaped the rhetoric around digital platforms and evaluate the plausibility of digital platforms as ‘ecosystems’ comparable with ecosystems in nature.
To read more about the stage two of the ECOANTITRUST initiative, click here.
To read more about the stage three of the ECOANTITRUST initiative, click here.
31 May 2021