 reining in big tech in Europe and America, what US policymakers should know. There really has been a lot of progress towards setting up a system for real accountability for the most powerful digital platforms, but a lot of it is happening in Europe. The ball is really in our court now to see what the US can do. And we've got an all-star roster of experts today to talk about this starting off with Senator Amy Klobuchar, the new chair of the Senate Antitrust Subcommittee. Senator Klobuchar has been an outspoken leader working to improve US competition policy. She's led multiple important legislative proposals to improve the antitrust laws from rebalancing merger presumptions to tackling exclusionary conduct. We can't wait to see what she'll do with the chair's gavel this Congress. Senator Klobuchar, thank you so much for joining us today. Well, thanks so much, Charlotte. And yes, the gavel. I'll finally be able to call hearings, which as you know, the House has been doing an extraordinary job with a series of hearings and recommendations, but we were limited on the Senate side. I actually get along quite well with Mike Lee and he did do some good hearings, including a recent one we had on Google, but I'm gonna really step up the pace and with also a focus on trying to do oversight, of course, of what's going on at the agencies with a lot of exciting possibilities there and help them to fund the agencies and then finally legislation. And that's what I'm gonna talk a little bit about today. I would be remiss not to note the moment that we're in and that it's one of the most challenging periods in our nation's history. I think we all know what the pandemic has done, not only in some of the competition issues, which I'll discuss briefly, but also just to everyday citizens losing more than 400,000 Americans. And we also, of course, have had the divisiveness in our politics, which was on full display in the insurrection that occurred at the Capitol. And so I really took that inauguration as this major moment for our country to come together as a moment of hope. It literally took place on the same platform with the green spray paint still on the bottoms of the columns. I don't know if people saw it, but it was there. All the windows had been broken through and we got them fixed and Senator Blunt and I felt very strongly that beautiful sunny morning was going to be a moment of national unity and hope. And as I said, it was the day that our democracy picks itself up, brushes off the dust and does what America always does, to go forward as a nation under God and divisible with liberty and justice for all. And part of going forward as a nation is to make sure that our economy works and it works for everyone. And a lot of that has to do with competition policy. And the word antitrust, I think we all know is a little limiting. Although I've enjoyed the recent news, I was teasing Pete Buttigieg, who just got out of our committee with I think practically, if not a unanimous vote as transportation secretary, I've been teasing him for months that after our rivalry during the presidential campaign that his book is called trust that he put out this fall and my book is called antitrust. But despite that name of my book, I think that we all know that the word can be limiting for some people and that what we really need to do is start talking about this as competition policy. And we know when it comes to the tech area, especially we have seen this enormous transformation of our society. So much of it good connecting with friends, consulting with our doctors, especially during the pandemic, working remotely, ordering our groceries, you name it. And the technologies have transformed our lives. But just because these companies are successful and have brought us good things, doesn't mean that we just sit back and go, that's great. And just let the consolidation continue. To me, it means we want more successful companies. We want the next development. We want the prices to go down. We want privacy legislation. And I'm so glad to see that Tom Wheeler is part of this group as well because he knows this area well as Fiona and Charlotte. So a lot of this is looking back at our roots as a country and what really made our economy strong. And so much of that has had to do with the realization way back to the founding fathers that we had to have some balance and that we wanna have a successful capitalistic economy. And I mean that in a positive way. We always have to make sure that we continue to have a situation where we have new entrepreneurs and new ideas and new innovation and some fairness and how all of this works. And so right now we don't have that fairness. And I think we know that it's not just the US that is taking this on. Just like the global pandemic has affected every person on this planet, we have the same situation when it comes to tech and what's happening across the world. Look at what we just saw in Australia. I don't know if that got resolved but a few days ago when literally Google was threatening to cut off their country, off of their search engine simply because they were trying to put a price on content so that you wouldn't have one company taking content from journalists and not being able to pay for it or being able to assess it in a way that didn't work for their country. That's the right to try to figure that out. The European Commission has proposed a Digital Markets Act and a Digital Service Act to address the power of big platforms. And I've spoken with Executive Vice President Bestayer about these proposals and we're gonna be discussing these issues at Southwest at the conference later in the year. And these are issues that we should just leave to our Australian and European friends as much as we like them. The digital platform monopolies are American companies and we're proud of that. But that means that we should be taking the lead to craft solutions that serve the interests of our country and the world. And I think we need a multifaceted approach. I know you know this to dealing with the power of these incredibly sophisticated companies. That includes privacy. That includes some of the issues that we've raised recently about content, interoperability and non-discrimination rules and of course transparency. But the first thing we have to realize it's kind of like going to an AA meeting. My dad is a proud member of AA even at age 92. I was kind of acknowledging that we have a problem and we have a problem. We have a major monopoly problem and it's a problem that isn't just limited to tech. Although of course there's been a lot of focus on that given that we have I think two trillion dollar companies now in their ranks. And when you look at the top five tech companies they combined have completed more than 700 acquisitions since 1987. A lot of these deals were just let through not anticipating what they would mean. And that's a lot of what my legislation and I believe the work of the Justice Department which I have commended probably brought a little too late there at the end of the year but still nevertheless the fact that the Justice Department brought the Google case and the FTC brought the monopolization against Facebook was a major game changer as well as the work that's gone on with the attorney generals across the country. An important feature of the cases is that they include calls for structural relief which of course is anti-trust speak for breaking up a company. But remember that doesn't necessarily mean that it's radical unless you consider AT&T a radical company they were broken up many, many years ago and they were then able to compete in a better way. And I'll get to that in a second. I saw this firsthand as a young law firm lawyer. So actually my work in the law firm way back before I got elected to anything was about taking on a monopoly. My big client was MCI. I somehow got that client as a young lawyer because no one at the firm could understand what Interlata or Interlata met and I took it on. And I saw literally what had been and what would be in terms of the launching of this incredible cell service market in terms of the prices going down with long distance and nearly in all cases before the regulatory bodies that I led for years we were on the same side of the consumer groups. We were on the same side of the attorney general's office. So that was my first involvement in any of this. And then of course I got to the Senate and I learned a lot more. And when I look at this, is this possible that we build an anti-trust movement again and get some legislation passed as has happened throughout history when we've confronted new problems in anti-trust? And we just haven't done this yet in this country. But when you go back in time I mentioned the founding fathers, the Boston Tea Party wasn't just about taxation without representation. It was also because a lot of our original citizens that came here, they actually were fighting the monopoly in Britain and there were all kinds of monopolies. But they in particular got pissed off when they realized that they were gonna have to get their tea from one tea company the East Indian Tea Company and that meant they couldn't have competition. And so that's what in part what the Boston Tea Party was about. Then you go forward and you see this heavy involvement in the Midwest as our country grew. Farmers standing up for monopolies, a Granger movement actually started in Minnesota and in Iowa. The unions in Chicago, whether it was the Haymarket riot, the Pullman strike literally played this role in a very visceral way in pushing against what were called then the trust, whether it was a sugar trust or the beef trust or a standard oil. And there was so much political activity back then that it was literally a competition between the political parties of who could be strongest. And that would be everything from Teddy Roosevelt riding his literal anti-monopoly horse into the White House or whether it was Senator Sherman who was a Republican from Ohio who was the original author of the Sherman Act. And so this was always bipartisan with William Jennings Bryan and so many that were focused on the power of monopolies. And so when you look at that it gives you some hope that we can do it again. I don't know if we'll get back to the point where Woodrow Wilson ran in part with a anti-trust political song. One of his campaign songs was about antitrust. But I have noticed the hats that hopefully will now be replaced at the Antitrust Bar Association meetings in the last few years that would say make antitrust great again. Okay, there you go. But there is some knowledge of the history that we have. So what's happened that's caused our monopoly problem? Well, during the 70s and during the time and rise of the Bork philosophy that really got into a lot of our judges heads and in our court decisions. And there've been a series of Supreme Court cases over the decades, recent decades that have really crippled the effectiveness of the current antitrust laws. And the hard fought legal victories of the past like the breakup of the bell companies have given away of course to a lot of failed cases. In 2008, a former Justice Department official observed that it had been more than 15 years since a plaintiff had won an antitrust case before the Supreme Court. That would be called a kind of a cramp on people wanting to go forward with cases. And I think you see the problems with that. So what's the solution? Well, obviously I've pushed these new judges. I will note that Justice Kavanaugh did side an antitrust case with at the time Ruth Bader Ginsburg and Justice Breyer and others in one case recently involving Apple. But I think we all know given the conservative nature of those justices, given their track record before they got to the court, I don't think that's really gonna be our, I'll call it the knight in shining armor here. I think that that will take maybe 50 years or 100 years, maybe with a few exceptions in the tech area to be able to be our savior. So I think what we need to do is one, up the enforcement and use the existing laws as best we can. If you think I'm just talking garbage, 1980 time of the antitrust AT&T case, the DOJ Antitrust Division had 453 lawyers. By 2017, it had just 330 lawyers. So ask how they're gonna be able to take on the biggest companies the world has ever seen. FTC, 1,719 employees in 1980 during Ronald Reagan's time around that era. Now it's down to 1,102 employees as of 2018. So Senator Grassley and I have a bipartisan bill that has a lot of support on both parties to change the fees for mega mergers. That would add about 135 million split between the agencies which would make a major difference. We were able to work with the Trump administration with Macon Delrahime and the FTC, Chairman Simon at the end to get some money in I think about 15 million per agency, which will be helpful. But I think it just goes to show what they're up against. Secondly, if we can't change the courts quickly what can we do to change the laws? Well, we can change the merger standards. I have a bill on that which would look at the threshold that exists now which says that mergers are not legal if they substantially less in competition which is a really high standard. You could change it to materially less in competition which is more than a de minimis amount. That's what my bill does. You could change the burden on the big cases that they have to prove that it doesn't materially less in competition. Exclusionary conduct, that's another bill that I have with some good co-sponsors. And that would look at shifting the burden to dominant firms to prove that their exclusionary conduct doesn't risk harming competition and does other things with regard to the conduct. Civil fines for monopolization violations. Lookbacks, having the FTC gather information once again they used to do that about concentration in industry so that we're looking at it not just well, does this merger look good or not? We're like kind of looking at what are the industries? Cause I think there'll be a lot of surprises. I remember a very amusing John Oliver segment which he did on antitrust and he went through all the consolidation from sunglasses to cat food and then ended by saying if this is enough to make you just wanna die. He said, good luck cause there's only three coffin makers now in the country. By the way, that is now down to two cause one of them bought the other. And so so much of this beyond tech has been allowed to fester. And I fear that it's only getting worse in the pandemic when we've lost 100,000 small businesses obviously particular industries like tech getting more and more concentrated. So as chair of the antitrust subcommittee I wanna make the case for this antitrust law reform. I wanna have oversight hearings. I was really pleased that Merrick Garland raised the issue of antitrust when he stood next to now president Biden when he nominated him to be our next attorney general. I think there's a lot of he has handled major antitrust cases. He has a good understanding of this. And that's the first, as I said acknowledging what the issues are and learning them are gonna be the most important thing. So he will certainly hit the ground running. And I'm looking forward to seeing who the Biden administration puts in place. Obviously I'm advocating for aggressive and effective leadership at the anti-trust division and at the FTC and working with David Cicillini and Jerry Nadler and our partners in the house on pro-competition proposals. And I think a lot of this when you start talking about this people kind of, you know the word antitrust and what all this means but I also think it somehow is taken which we have to fight against as it being somehow anti-business even successful companies even popular companies and even innovated companies are subject to the laws of this country. And their success does not give them a free pass to harm competition. And in fact, the AT&T example is a great one where one of their former CEOs said it actually made them stronger that they got through all of that and now they were able to kind of dust off some of the old ways and be able to compete in the modern world. And we all know the success that came out of that. And I would predict the same thing would happen if we would unleash Instagram and unleash WhatsApp and unleash some of these other companies which were considered nascent when they were bought but we now know that the intent of the companies in buying them was to simply be able to bolster their own position in the market and make sure that they weren't developing competitors. That's just wrong. And we have an opportunity to do something about it. I'm hoping we can be joined by people from both sides of the aisle. We have to be able to pass this but I can tell you one thing. The public is with us. They understand the problem. They figure out after a while that when they go to look for online travel deals when the pandemic's done that in fact all the names of all these companies it really just boils down to two. They just have different names but they're owned by the same thing. So to me we have an exciting opportunity ahead to continue the work of the last hundreds of years where our country stood tall to make sure that we had strong competition, entrepreneurship, new ideas and this is the moment to make that happen. So thank you for allowing me to say a few words and I know you'll have a lot more good words to say as well. So thanks Charlotte. Thanks everyone. Thank you so much Senator Klobuchar because we're not in person. We don't have the rousing applause that I think is warranted. Just imagine it out there. Yes. So folks can see Senator Klobuchar and actually me as well later this afternoon at State of the Net will be talking about different issues but thank you so much Senator Klobuchar for being here today. That was fabulous. Thank you. Thanks guys. Thank you. Next we have a presentation from the UK's competition and markets authorities chief economic advisor, Mike Walker. The UK has been one of the big leaders of the effort to reign in big tech and Dr. Walker will walk us through what the UK is doing about big tech and a little bit about what the EU is doing as well. I know that's a lot to cover in your 15 minutes and then we'll have our expert panel to discuss afterwards. Thank you Dr. Walker. Okay. Thank you very much for the invitation Charlotte to speak. So I should just put my usual caveat is although I am chief economist at the competition and markets authority I'm speaking in a personal capacity. So I'm going to start off by echoing something that Senator Klobuchar said which is the starting point for thinking about regulation and antitrust with respect to big tech is to acknowledge that they make great products and they provide great services. That is why they have got these very strong market positions. I have no idea how many times I use Google this week already to search stuff. Unbelievably useful. However, that is not a get out to jail free card. And the mere fact that you produce a great product or provide a great service does not mean that you are therefore allowed to engage in anti-competitive behavior to protect that monopoly power that you've earned or to extend that monopoly power into other markets. Okay, so that's the starting point. Okay, I'm going to make four broad points today. I'm going to talk a little bit about our work in the UK looking at Google and Facebook and what we found and what it has implied in particular around regulation. I'm then going to talk about how we are proposing in the UK to regulate big tech. I'm going to then briefly compare our proposals to those of the European Commission in the Digital Markets Act. That will be brief because I know Christina and others are going to talk about that in more detail. And then finally, I will provide some possible lessons for the US when thinking about that. And I just distress, I do that within the context not of we know the answers. We certainly don't know the answers but within the context of we've done a lot of work, think about these issues and this is where we've got to and that should be, we hope that that use will provide some useful insights. Okay, so first of all, I'll work on Google and Facebook and what did we find? So what we've done is we've done a year-long study looking at digital advertising. And lots of people, when you say that, they think that's a little bit arcane, what's that got to do with anything? And of course, digital advertising is absolutely where Google and Facebook monetize their market power. So it's absolutely key to the strategies of these firms and that's why we looked at this market. In the UK, it's worth about $19 billion a year. So that's about $700 per household in the UK. So that's a big deal and to the extent that prices in that market are higher than they should be, that is something that will affect advertisers who are trying to sell their products online and advertisers who are spending money selling their products online, they need to recoup that money somewhere and they're going to recoup it in the prices they're charging for those products. So ultimately, this is money that consumers pay. So what do we find with Google? So with Google, no great surprise. We found that they have very substantial market power in search and that gives it therefore very strong position in search advertising. So if you put in a search term, you put in on-the-bike training shoes, there's the first three or four returns that you get in your list will have adverts. Next to it, those are paid for adverts and Google has the vast majority of that market more than 90% in the UK. It also we found has market power in what is called the ad tech stack. Again, sounds quite arcane, but that is the vertical chain between an advertiser who wants to advertise a product on a website and the owner of the website who wants to accept adverts on their website as a revenue stream. And there's a complex set of intermediaries between it. But the key point to note here is that Google in all of those intermediaries has more than 50% of the relevant segments and actually has more than 90% in a couple of the really important segments. And that is where the search monopoly has largely been created by providing great product. Our view was in ad tech that market power has largely created through acquisition. So for instance, DoubleClick, a company that Google bought back in 2008. We reckon that the market power, both in search and in ad tech, leads to higher prices for advertising, which as I suggested, feeds through to higher prices for consumers. And we also found, and again, this is, that's not rocket science, we found that the Google has protected those market positions through sort of environment strategies to create an ecosystem. So if we just focus on digital advertising, lots of advertisers want to just use one intermediary in order to organize that digital advertising, particularly small and medium firms. So if they're going to advertise through search and they're going to advertise on websites, it's convenient for them to use the same provider. So the fact that Google is strong in both of those sectors is self-reinforcing. And of course, they've also got YouTube. So they bought YouTube back in 2006. Again, lots of adverts on YouTube. So again, if you want to advertise on YouTube, there's an advantage to using Google. So they've managed to create a position of power that looks very difficult to, for other firms to challenge. Okay, so that was Google. What about Facebook? Okay, so we found that Facebook has significant market power in social media. We found very much it's sort of a must have platform. So if you look at, for instance, in the UK, users of Snapchat, more than 90% of them also use Facebook. If they use Twitter, more than 90% also use Facebook. Same for TikTok, but the reverse isn't true. So if you're a Facebook user, about 50% of you will use Twitter, but only about 25% of you will use Snapchat. About 10% will use TikTok. So Facebook's got a very strong position in social media. Again, we found that that led to higher prices for advertising, again, feed through to consumers. And two things to say about that. One, Facebook has a history of protecting that market power through exclusionary behavior. So just to give you one example of Vine, which is a company that provided a complimentary product for Facebook's offering. And Facebook is very happy for Vine to operate with Facebook as long as it was providing a complimentary product. But as soon as Vine was perceived to become a competitor, Facebook suddenly degraded that interoperability and made it much harder for Vine to interoperate. And of course, Facebook's also protected that market power through acquisition. You know, and to the point which I mentioned this, you know, so the Instagram acquisition, for instance, if you look at the UK, Instagram is absolutely the second largest social media player in the UK after Facebook, but it's owned by Facebook. So there's no competition there. So what we concluded on the basis of this analysis was that actually what was needed was a pro-competition regulatory regime to cover at least Google and Facebook. So it's explicitly accepting that we didn't think antitrust in its own was enough and that we needed some form of regulation, which in the UK is now called the digital markets unit. Okay, so what are these proposals? So in the light of our market study in Google and Facebook, UK government asked us to think about, okay, what should a regulatory regime look like? We've now made proposals, the government's basically said, fine, go and implement those. So what we're proposing is that firms, some firms should be designated, some of these large platforms should be designated as having strategic market status, which is, so what does that mean? Okay, it means these firms, or we are defining that to me, these firms have substantial and entrenched market power in additional activity and that that substantial and entrenched market power provides those firms with a strategic position. And what do we mean by strategic? We mean that the effects of those market power are both widespread and significant. Okay, and both of those are important, widespread and significant. And that's fundamentally an economic analysis. So that designation of whether a firm should be caught by our regulatory regime, whether it has SMS, strategic market status, is a firm specific analysis. It's fundamentally an economic analysis. We think we've done that now for Google and Facebook, at least with respect to the search and tech and social media. I'm not letting any cats out of the bag to suggest that we're gonna move on and look at, for instance, Apple, Amazon, Microsoft. I mean, this is all fairly clear. If our proposals are, if a firm is found to have strategic market status like Google or Facebook, they will face a bespoke code of conduct. So it could be two aspects, or three aspects to our regulatory regime. One is a bespoke code of conduct, specifically saying for each of those firms, some things that they can't do or some things they must do. And the idea of that is to restrict the exercise of existing, existing market power. And secondly, we're gonna, for each firm, have a bunch of pro-competitive interventions. So for instance, land data mobility, interoperability, access to data. And the idea of those is to encourage new entry to make it easier, and again, something central, which I mentioned, to make it easier for new firms to come in and challenge the digital giants. Okay, and then thirdly, we've recommended a enhanced merger scrutiny. I'll explain that in a minute. It's really important to understand this is not standard old-fashioned rate of return regulations. We're absolutely not trying to do that. The aim is to encourage competition, not to bake in the established market outcomes. So it's not rate of return regulation. And it's also not something that we think is going to damage innovation incentives. So something you often hear from tech, well, if you regulate our subtle damage, our incentives to innovate. Speaking as an economist, the battle over whether it's competition at least innovation or monopoly at least innovation was won a long time ago by Kenneth Arrow. It is competition that generates innovation. And that's therefore what we need to detect. That's what we're aiming to protect. Okay, I mentioned merger scrutiny is important because of the historic under-enforcement against mergers gains. And to Clemenshawn mentioned that, but I think it's quite clear now what we know now that Instagram was a bad merger. WhatsApp was a bad merger. I'd probably say DoubleClick was a bad merger. And historically, the tendency of competition authorities, I mean, including the UK with these sorts of tech mergers has been to say, oh, well, this is really difficult. And it's all very uncertain. We don't know where the market's going to go. And so the right answer is to do nothing. Okay, that's clearly not the right response to uncertainty, particularly not where the cost of getting these decisions wrong might turn out to be very high, witness Instagram. Okay, third point, so I'll be quite brief on this, is how does what we're doing compare to what they're thinking about doing in Europe, with the Digital Markets Act. First thing, there's a lot of similarity. We like them, want to restrict current market power. We like them, want to open the market up to entrance or they like us, want to do that. They are taking a different approach to how they're going to decide which firms should be subject to that regulation. So they are going to designate some firms as gatekeepers, some platforms of gatekeepers. And that's a more mechanical designation than what we're doing. So for instance, are these core platforms are an important gateway for business users to reach end users? Do they have more than 65 billion market cap, more than 6.5 billion revenues, more than 45 million user? I mean, that sort of thing, much more mechanical than what we're doing in the UK along with a specified list for those firms of do's and don'ts. And they're not including mergers. Now, I prefer obviously the approach we're taking in the UK because it's more firms of specific. And that seems right to account for the differences in the characteristics of the firms we're talking about. So, you know, they have different business models. So if you think about, well, Google and Facebook as I just talked about, are largely funded through digital advertising. That's very different to some of the firm like Amazon, which is also transactions. Largely transactions funded company. Or if we think about Apple and Google in terms of operating systems and the app stores, again, that's a different business model. So it seems to us that it makes sense to use, have a firm specific approach, you know? But I do want to emphasize that the similarities between what we want to do and what the commission have recommended vastly outweigh, well, significantly outweigh the differences, I think. And look, I don't think it's in anyone's interest to have substantial regulatory divergence within Europe. So I think, you know, we all have incentive to avoid that. And of course, not just within Europe, but also across Atlantic. So, you know, I think it's, you know, who knows which is going to be exactly the right approach? You know, the Brussels, it takes a different approach to us, you know? And it may turn out actually they're spot on and we need to slightly change our approach. But we do, it's important that we learn from each other. Okay, in my final couple of minutes, you know, are there any lessons or recommendations I would offer to the US from our experience? Okay, and look, this is very tentative. You know, I'm not suggesting we know all the answers, but we have done quite a lot of thinking. So on that basis, I'm going to give one lesson and two recommendations. So the lesson is antitrust is not enough on its own. Okay, it's, I mean, European Commission had three, had three big cases against Google, Android shopping and online advertising. And they really showed the limits of the remedy powers of antitrust. I mean, they find Google in total nearly $10 billion. I doubt Google noticed. So that doesn't really cut it. These also one-off interventions. And I think we need a regime that is flexible and can change over time as a market conditions change and as the strategies to the firm change. And also antitrust takes forever. You know, the Google shopping case started in November, 2010. Decision 2017 is still in the courts being appealed. I gathered the FTC against Facebook isn't scheduled to start until late 2023. Bill Kovacic suggested it might get to Supreme Court in 2026. That is not swift intervention. So that's my, the lesson is antitrust is useful, but it's not enough on its own. Two recommendations. Okay, one recommendation is, I think you should make your regulatory regime bespoke to the companies, the particular companies in question. I don't think one size fits all. The other recommendation is, and again, this entirely consistent with what Senator Klobuchar was saying, is you've got to include, I think mergers in your regulatory regime. There has been historic under-enforcement. We, I think do need a different standard of merger control, a standard that allows us to intervene perhaps on a more precautionary approach. And so that is part of what we're going to do in the UK. Thank you very much. Wonderful. Thank you so much, Dr. Walker. That was an excellent presentation and I think this will really give our audience and the panelists a shared baseline for discussion that we'll now have with our panel. We would be here all day if I were to read our panelists' impressive biographies. So please go check them out on the Eventbrite page where you registered for the event. But I want to welcome Dr. Christina Caffara, Head of European Competition at Charles River Associates, Professor Fiona Scott Morton, Economics Professor at the Yale School of Management and former FCC Chairman Tom Wheeler. So for the audience, we will take questions from you at the end. So as you're watching, please put your questions in the little Q&A section at the bottom of the Zoom window. Great. So I think we should start off. Dr. Walker gave us a few lessons that he thinks we should learn from what's been going on in Europe and the UK and maybe each of the panelists could give us, what do you think is the most important lesson that the US should take from the EU and the UK dominant digital platform regulatory efforts? Christina, do you want to start us off with that? And then we'll go to Tom and then Fiona. Thank you, Charlotte, and thank you public knowledge for this invitation. I hope you can hear me. I should say that as well as the bio, it is important to also check out people's disclosure, which are also on the website. That's why I want indulging to disclosure at this point and go straight to substance. I wanted to compliment and expand a little bit on what Mike has discussed in terms of the European effort and provide perhaps a little bit more color and texture to the sort of European, the continental European side of the thing. I think I'm personally a big supporter of what I see as a great experimentation that is going on on digital platform regulation in Europe. And I call it experimentation because as Mike said about, Europe is not by any means just the European Commission. There isn't a single approach which is being cooked up in Brussels that's going to necessarily be speaking absolutely for everyone. Of course, the purpose of the rules that have been cooked up in Brussels is to avoid fragmentation, avoid a patchwork of national rules. But as Mike illustrated, the UK is doing very much its own thing. Of course it has set off charting its own course where the anchor moved away. But even on continental Europe, you don't have just the Brussels view. There is a body of national competition authorities who are extremely powerful, they're very active, competent, they've shown a huge appetite for enforcing themselves, doing it their own way, particularly I think of Germany and France, but not only. So they're not just the wheels of Brussels. There's a lot of attention that needs to be placed on what kind of things they're doing because they're not necessarily all doing what Brussels is expecting them to do. So I want to give it again, a little bit more sort of context as to why in Europe we are veering so towards regulation and towards this experiment. And I think as Mike said, we have done a lot of antitrust in Europe, in digital. The European Commission has done cases, the cases Mike mentioned against Google, but not just that. There is a local case that's been in the way for some times, but AppTech didn't get any traction early on, but now it is in the site of the European Commission. There is a data case, which is in the site of the European Commission against Google and against Facebook. There are two Apple cases, there are two Amazon cases. There is quite a lot of antitrust cases going on and at the national level, besides what Mike has discussed in the UK, there are cases in Germany, very big flagship case on Facebook that's been regarded as quite adventurous. Cases in France against Google, the AppTech analysis there and even in Italy. So there is quite a lot of antitrust going on. That said, I think we all share, I think the common view that antitrust is not enough and it is not enough exactly as Mike says because it has not delivered, it has taken too long and the remedies have failed. The remedies, again, with great intention, good intentions didn't deliver, didn't move the dial. Perhaps the cases were narrow and it is difficult to deliver a global solution with some targeted remedies and there's much to say. There's another factor that I think explains this growing awareness that antitrust isn't enough and really we need to shift towards regulation. And it is this notion that some of the key underlying issues are about using exploitation of data and these cannot be really dealt with particularly well with the antitrust tools. I've been advocating for a long time that we need to just move on from the antitrust or obsession with exclusion for closure and power up exploitation as a theory of harm. But even with exploitative abuse, exploitative theories, you only get so far when you worry about the data-free for all, which is very much of the source of many of the problems we face. So one can try and tackle some of these keys is to antitrust. So Google is dropping third party cookies and everyone screams, this is self-preferencing. Well, it is, but is the problem of the data-free for all going to be resolved by a self-preferencing case? And I'm sorry, Mike, this is a case that's before you just now and I've got no involvement. I'm just saying it. I'm just saying it because I think it is important. So the data-free for all is something that we, we have the GDPR, the regulation about data and privacy, but it is tricky and it's not being applied sufficiently. So there's a notion that we need to do regulation to go beyond antitrust in multiple dimensions. So whatever we've got, the DMA is a proposal that has come out in December that the commission has put on the table. I think it record time because this is something that they had committed to 2019 and kind of did their homework quite quickly. And it is basically based on two pillars, fairness and contestability. Fairness is really about, in some sense, redistribution and contestability is about fundamentally barriers to entry. It is very much as Mike emphasized, not a common carrier type or regulation, although there are common principles to common carriers. So there is no discrimination and all that is still in the spirit of the law, but it isn't a common carrier regulation. And it isn't even about breaking up because we're polite in Urbain in Europe, we don't break things up, but we do rules, we do regulation to try and bring about more entry, lower the barriers and hopefully to try and redistribute to some extent. So this applies to a bunch of companies is intended to apply to a bunch of companies that are defined designated as gatekeepers. I am very partial to the okay approach I must say, but let me just illustrate briefly what the commission is doing, what the EC is doing. They are essentially setting out quantitative rules, as Mike said, to do with turnover, to market cap, to do with active users, which they should be able to be applied to decide whether one is in or out, right? So it is a pretty rigid sort of criterion. And as you can imagine, it has triggered all sorts of panic. Am I in, am I out? Oh, on this criterion, I'm in, I'm out. I'm not a gatekeeper. So we're facing almost a lot of lobbying from the most implausible people, saying me a gatekeeper never, what can you possibly think? But in fact, there is that kind of quantitative threshold. And then once you are in, then there is a set of rules some are thou shall not do, you cannot do this, some others are more nuanced and they're supposed to apply. I think that in the main, the main, you know, they're fine. The main observation I will make is that at this stage, and we're far from a final version, they still read too much like a compendium of these are the cases we're doing. Here's the abstract and I've put it into the rules, but the main difficulties then it becomes quite difficult for anyone to go from that abstract of a particular case. This is the abstract of Amazon marketplace. This is the abstract of Apple app stores to a notion of what applies to me if I'm not Apple and I'm not Amazon. So how do you map from those rules that are this kind of abstract into actually a rule that are recognizable by company and apply to them? So I think there would be, I'm hoping that in the transit through approval, this can be qualified very briefly. I think the important lacuna in this whole thing is that as Mike has emphasized, it does not include merger control and that is a major, a major problem. The UK is folding merger control into its own regime. The commission has in touch to cut a rule that says if you're gatekeeper, you have to tell us if you're doing a merger. Well, what does that do? It doesn't do anything. And of course there are limitations that I understand as to why they couldn't change the merger regulation at the same time, but that is a limitation. So last minute, what happens now? Clearly this is something that is a proposal needs to go through parliament. Normally it takes three years. So everyone, not so fast for something like this to be approved by parliament, except that on this case, there is a body of very militant members of parliament, MEPs in the parliament led by Andrea Schwab who is a very motivated German MEP who has promised to rocket it through parliament in a year. So in principle, we could see this approved early 2022. So by then we could have the DMU in the UK, we could have this up and running and don't forget, and we'll talk about it later, there's also Germany, there's also other things happening in Europe that are worth thinking about. So there's a lot of experimentation going on and you'll get to watch it. So I'll stop here for now. Well, Christina, first of all, Christina, Charlotte, responding to Christina, thank you for inviting me. And if I understand your question, it's okay, what have we learned from Europe? And I think Christina and Mike have opened the discussion in by explaining what's going on there. And I think that means we've learned, at least my takeaway is we've learned three things. The first is, do something, all right? And we have been burying our heads in the sand in the United States for far too long. I mean, we're multiple decades into the digital era and we've been afraid to touch digital companies because we might break the magic, you know? And it isn't magic and what Christina and Mike have just walked us through are some of the effects of that and the point that they made and Senator Klobuchar made, you know, Senator Klobuchar talked about competition policy versus antitrust policy. There are two different things. And to address antitrust issues is important, needs to be done, but it doesn't solve competition issues. Antitrust can't solve interoperability, antitrust can't solve transparency, antitrust can't solve privacy and a whole list of other issues. So do something recognizing that it is beyond antitrust. Point two, as our times are new, so must we think anew. And the tendency is always to say, well, how do I take what is existing now and put it into the structures and statutes that I have now? And the problem is that those structures and those statutes were built in the industrial era to deal with assets and industrial capitalism that are very different from digital assets and internet capitalism, and therefore get exploited in different ways. So this is not just a question of how do you take and put these issues into some pre-existing legislative or regulatory structure, but how do you recognize that you need a new structure and new statute to deal with that? And Phil Ververe and Gene Kinleman and I have published a paper at the Harvard Kennedy School calling for the creation of a new digital platform agency with new authorities and a new approach to regulation. And we think that putting new wine in old bottles doesn't work. Third point, there is a consequence from failing to act. And it is a consequence that we as Americans, excuse me, Christina and Mike, while I become a bit chauvinistic here, but as a consequences that we as Americans need to be concerned about. And that is that in an interconnected world, the rules that are made for others end up affecting us. And a reference was made, I think, by both Christina and Mike to GDPR. GDPR has become the de facto international standard. When the state of California goes to create its privacy rule, it uses GDPR as a base. I'm not against the fact that we ought to be having common principles, but I am saying we should be at the table. The United States should be at the table and you can't be at the table until you know where you stand. I've just published a paper at Brookings last week calling for a US-Europe digital alliance where we wrestle with these issues together. And if we don't do that ourselves, then we have the very strong potential that we get left behind. And that's not good for American companies, it's not good for American consumers. So I think those are the three takeaways from what we've learned this morning. Okay, I'm up next. My first, I also had three and my first one was time to move, which was exactly what Tom had to say. So I won't spend time on that. I think not only do I agree with others that antitrust is slow and limited for the kinds of problems that we're facing now, but also I just wanna highlight something that is very important in US jurisprudence. If you get market power through luck or because you were in the right place at the right time and you had a good product and you didn't violate an antitrust law and you now have tremendous market power over a section of GDP that we never anticipated that would happen, okay? The antitrust laws don't have much to say about that. You didn't violate the law. There isn't a way to fix that through standard antitrust lawsuits to the best of my ability, get the best of my knowledge. You've got to pick a different tool. You've got to pick regulation. And I think we have plenty of examples of digital businesses where an antitrust case would be very hard to bring. And yet we don't like the resulting entry barriers and market power and exploitation that's going on. So that's another reason for regulation. My second point is that in the digital market area consumer protection is even more important than offline. And that's because the choices we see are contained in a few inches of screen and the choice architecture is completely controlled by the party that is showing us that screen. And unlike in a brick and mortar store we're not walking in and out, we're not leaning down, standing up. You can't do any of that when you're online. And the result of that is that consumer protection laws are more, harms, dark patterns can cause more harms. Competition, consumer protection laws therefore can create more benefits. And there's a nexus between consumer protection and competition. If a consumer can't see the quality of what she's buying how can she move to an entrant that offers more quality? If there's no law saying that the product needs to disclose what's inside it how can she avoid things that she doesn't want to buy? So if we tried to buy bread in a market where there were no weights and measures and no food labeling and no standards of food purity the competition wouldn't work for us at all. Of course it wouldn't. And that's what we're dealing with online. So I think that we get a lot of bang on the competition side for fixing some of the consumer protection stuff. And then I would just remark that watching Europe it's a bit of a stress test for the United States. Here's Tom telling us that we need to have some regulation. We only sued these people last week. I mean, until October of 2020 we weren't even doing antitrust. And now three months later we're asking our viewers here on this call to make the big leap. Okay, antitrust is done. The Europeans took 10 years but we're gonna do it in three months. We're gonna be over it and move on to regulation now. So it is a big leap conceptually for I think the policy community in the United States because we've been pushing for antitrust for so long but I think many observers of this space really are interested in competition policy. They said they wanted antitrust because that was the word that they had heard but what they really want is for market power to go away. And they're gonna realize when the hearing is until 2023 and the case isn't resolved till 2027 that the market power is not going away through this tool. And so we have to move I think the community forward from antitrust is all we need into the let's use everything we've got because we have a bunch of challenging problems. That's great. Well, I've been advocating for regulation all this time, Fiona. So I'm hopeful that people have been paying attention but I'm sure a lot of people are new to the discussion now. So Fiona, I wanna come back to you. As you said, we have finally made this huge achievement of actually bringing these antitrust cases but I'm not slowing down for a second on pushing for regulation. So maybe you could talk about what's realistic to expect from these cases and what we should be focused on going forward. Yeah, I think there are two points of realism to keep in mind. One, as many people have said is the pace, okay? These we're not gonna start having hearings till 2023 then there will be appeals and the very last thing is the remedy. So we're talking about six, seven years before we would expect a market to change. And then the second thing is what can a remedy that's imposed by a court in an antitrust proceeding get us in terms of restoring the lost competition? We've all watched Europe deliver fines and I've heard Christina say many times the fines don't cut it, they don't change anything and that's right. We need to restore the lost competition. What tools do we have for that? Well, courts are a little bit hesitant to wade into this. So Microsoft, the government wanted a breakup and the court wouldn't go there. Now AT&T, we did get the breakup. I think that tools that could do a lot of good like interoperability are something that an antitrust enforcement agencies a little bit hesitant to apply because they require ongoing oversight for the foreseeable future. And that's not something we typically expect our antitrust enforcers to do, that's the job of a regulator. So wouldn't it be easier for the court if there already were a regulator in place? And the court could say, this is the remedy that the government wants. Now regulator, you go off and do it. So I do think that we're gonna come up to a hard place with remedies in these antitrust cases that are just not gonna be sufficient to get competition going again. Charlotte, can I pile on there for a second? I mean, Fiona raises a really valid point. If you go back and look at the experience of the AT&T breakup, that was made possible because the Federal Communications Commission existed right beside it and was able to deal with some of the operational and implementational issues associated with that breakup. Those were not skills that the antitrust division had or the court had, nor did they have the bandwidth, they, the antitrust division of the court, have the bandwidth to be able to dive down those rabbit holes. And so Fiona's last point here is I think particularly salient in that we can't look at these as silas. Well, there's antitrust and there's regulation. No, they are like this. Great. And Tom, I wanna follow up on something that you mentioned before, the need for a new regulator that is focused on digital platforms. Can you say more about why you think that's important? Yeah, but again, I think I mentioned a minute ago that the assets of the digital era are different and the way in which they are exploited are different. And trying to put that square peg into the round hole that was developed around the time of the late industrial revolution or the second industrial revolution is very difficult. I mean, let me just stipulate one thing. Just as Fiona has just said, the first tendency is, well, let's break them up. And then you look at the details of what's associated with that as she's just done and it becomes more difficult than what otherwise seen. So is there a quick reaction which is, well, let's just give it to this agency or that agency and let them worry about it. And the trouble is that these agencies, and I've had some up close and personal experience with some of their realities are populated by incredibly dedicated, incredibly talented and incredibly constrained individuals that the statute constrains them. For instance, what we don't have in law right now is agility. The technology is per se agile. 3G goes to 4G goes to 5G, but we're still dealing with rigid constructs that were established back at a time when there were no Gs. And the Congress has intervened over the years to say, well, no, I want you to lean this way or lean that way. The courts have come in to shape how the agencies would act on this issue or that issue. And as a result of that, there has developed amongst this very dedicated team a muscle memory that is not necessarily what is best for responding to the new realities of the digital marketplace. And so we need to recognize that there are, new realities call for new solutions. And we've done it before. I mean, the Federal Trade Commission, for instance, was once where financial regulation was overseen. Yeah, can I just say? And it wasn't sufficient. So we created the SEC, excuse me. Almost every, no, I'm interrupting you rudely, but almost every new technology has an agency, right? We invent telecom, they have an agency. We invent cars, we invent airplanes. I mean, it's completely normal. But the first step is always, well, let's put it someplace else until you dive down, you know, you talked about cars. Back in the 60s, when there was this big push for automobile safety, well, let's send it to the FTC was the answer that everybody. And then folks look at that and say, no, no, no, we need the National Highway Traffic Safety Administration with experts dealing with that and with specific topics. And just as we have to work our way through antitrust is enough, we have to work our way through existing agencies or F. Great. I wanna remind the audience that we're taking your questions. So please go ahead and throw your questions in the Q&A section of our Zoom conversation so that we can get to those. Okay, great. So Christina, Fiona and Tom have described a situation where antitrust is not enough and we need pro-competition regulation, but it sounds like you were saying there's sort of a different approach that they're taking in Germany. I'm wondering if you can tell us about that. Yeah, I think the focus on what process it's doing is interesting. And as I said before, I'm very partial to the UK approach to creating a specialist agency. What I think we shouldn't overlook is that this isn't necessarily the only way to go. What is happening in Germany is particularly interesting and we need to keep it in mind because Germany is a big important jurisdiction in Europe. And so what has happened there is in parallel with the commission developing the Digital Markets Act, there's been a whole process in the last year of essentially developing a new version of their antitrust law, which was approved by the parliament, the Bundestag just a little over 10 days ago, an amendment to the competition law with specific provisions that are introduced in the competition act, cartel law as they call it, to specifically deal with digital. So in some sense, you can call it a bit of a hybrid, but there was incredible across the floor support for this change in the law. All the parliamentarians at the end of the sessions stood up and clapped and cheered and there was an ovation. And it was quite funny to hear the parliamentarian who was presenting this law saying it was about time to get to the end of the Wild West methods in the digital sector. That phrase in the middle of a German sentence was quite entertaining, but the point more seriously is that this is now identifying inside the German law a new category, they call it this time, undertakings with paramount significance for competition across market. Okay, so it's not strategic market status as in the UK, it's not gatekeeper like in the commission, is now undertakings with paramount significance. And that then calls for the application of seven particular rules that once you are designated as a paramount undertaking, you're going to be applied heading to hold on to or be subject to and they are things that we recognize. Because again, there are restriction on self-preferencing, restriction on exclusive pre-installation, all of the kind of things that the DMA has got that presumably they, of course, the CMA will produce. And then what is interesting is that they also specifically talk about undertakings with relative or superior market power. They move away from the definition of dominance, which remember used to be the, is the threshold in Europe for intervention in antitrust, you need to have prove dominance. They are talking about relative power, relative or superior market power. And what is interesting here is that it does does very much play into the German tradition, right? In Germany, and this is a point that the president of the Kaltelamt of the German authority has made a number of times, there is a strong tradition which is not the tradition of efficiency, which is based on their or the liberal way of thinking which puts emphasis on differences in power. Really the issue here is companies using their power to restrict the freedom of choice, citizen consumers and other businesses exerting that power in that relationship, in that bargaining relationship with businesses that depend on them. So there's a strong notion of dependency. So this is interesting because it is not antitrust as you practice in the United States is a very European conception of antitrust that really proceeds from a concept that we have to protect businesses that are dependent on a big player. And that is what is going to play out. I think how this will interface with the commission, the AMA remains to be seen. The AMA though does not prevent national governments from applying antitrust rules their own way. So in effect, there will be a dual regime. Germany will continue to proceed and pursue cases like its Facebook case under the antitrust rules. They don't want to leave antitrust to do cement cartels. They wanna do digital cases and they will. But of course, there will be a concession to the European approach and they will apply there too. But it is to say that again, experimentation, experimentation, there is so much going on that looks a bit different. The objective is the same, but it means to get there a different. And I think it's incredibly exciting to watch. Great. And maybe part of translating that German experience for the United States is just even though their antitrust law is very different, that part of what we need to do here is also improve our antitrust laws. We're using all of the tools at our disposal and that's one of them that Germany seems to be working on. So I saw yesterday the European Commission President called on the Biden administration to work with Europe on rules to rein in big tech. So I'm wondering if you think there's room for agreement here and would there be real benefit to that? Why don't we start with Fiona and then we can go to Tom and then Christina. Actually, could I bat this question over to Tom because I know that he has some thoughts about this or develop in mind. Thanks, Fiona. Yes, I just wrote a paper published last week by Brookings Institution on the need for this kind of an alliance. I'm a frustrated historian. And in 1875, the French government called together the other European governments who owned and operated telegraph networks and said, let's set common standards and rules for those operations. And that gave us the first electronic network and the opportunities that were encouraged as a result of common standards in your connection et cetera, in an interconnected world. We can't just retreat into our, oh, well, we're special here. The policies that are made in one place are gonna have an effect in others, a positive or an negative effect. And so in this kind of a world, we ought to be cooperating in how we develop those rules, after we pass the net neutrality rules. Two weeks later, I was in London with John Salot, our general counsel, sitting down with our counterparts in the EU, helping them think their way through the development of their own set of net neutrality guidelines. And we could only do that because of the fact that we had done that. And the tragedy, I think, is that in an interconnected world in which the United States has an opportunity to use that interconnectivity to provide international leadership, we aren't. China is, all right? Others who may not have similar kinds of concepts are. And so Western liberal democracies ought to be banding together, it seems to me, to say what are the principles? Not repeal sovereignty, but what are common principles that we need to subscribe to? Thanks, Fiona, as they say in the Senate for yielding the floor. I also want to point out that there are likely to be externalities, which will be interesting. If, for example, Europe, most first, companies comply and there's a lot of, let's say, transparency on e-commerce sites or access to app stores, I think consumers in the United States are going to look at those. Businesses that operate in two jurisdictions are going to look at those and say, wow, that's working for me, or it's not. And then that will provide more political pressure to change in the United States because those businesses will see that they benefit. So, and it might be then that there's a lot of people using a VPN to pretend to be located in Ireland so that they can get whatever service is available in Europe and not here. So I think things like that will be pretty fun to watch and there'll be a lot of learning in both directions. So I think we should bring in Mike on this question of convergence as well on the idea of the multilateral kind of world we live in. My position, and I think it's clear from what I said earlier, is that there are some approaches that I think personally make a lot of sense. I mean, again, I'm very partial to the UK approach because it is one that says, are you a digital gatekeeper? Well, you look like one coming this door. Then we're gonna talk to you quite a bit and figure out what your problem is, what it is that you're doing wrong and then we're gonna give you rules that are specific to you. Kind of make sense to me because of course the business models are very diverse. They are heterogeneous and to do things you need to understand that. That said, I think that there is a common understanding by now that there are certain things that we want to look into. I personally think that a ban on self-preferencing is a bit crude because different business models have got different propensity for self-preferencing, different motivations for it. And some of it may be worse than others. I still nonetheless think one wants to look into it. Do we call it self-preferencing? Well, only when it harms consumers in my view. But all of this is something that is detailed. I think that it is important to have a common direction and I don't think very much in a sense turns on having a precise convergence of approaches. I think we actually benefit from watching what one another is doing and not trying too early to squash it into a single approach. I realize we don't want to have a patchwork, okay. But this company's got resources, they can deal with it. And I don't think it is necessary that we immediately converge into the single approach. I don't like what you think. Okay, well, I mean, I probably speak agree with you, which is always a strong position to be in. History tells me. Look, I mean, I think international cooperation is really important in terms of talking about these issues and learning from each other. But it's important, two things are important here. One, that doesn't mean that we all have to move together because then we're going to be moving at the pace of the slowest. And from where I'm sitting, that looks like a really bad idea at the moment. Secondly, I completely agree with Christina's point that actually we can learn a lot from each other around the details of what works and what doesn't. As I said, there's lots of differences in the detail between what we're doing in the UK and what is just in Brussels or what's been suggested in Berlin. But as Christina says, direction and movement's the same. The aim is fundamentally the same. So I think these things can coexist. And over time, no doubt, we will lead to a converged solution, or at least I hope so. But I don't think we need to immediately rush to that converged solution if we run the risk of moving to the wrong converged solution. So one of the questions that I hear come up a lot is which companies ought to be included in the regulations and how should we draw that line? Christina, that's something that you got into a little bit. Maybe you can start us off in answering this one. Well, I mean, I'll be brief because I've spoken enough, but I want to give the floor to others. But if you take the notion of a gatekeeper, I quite like, and the way Fiona and I were thinking about it in an article we put out there is very much, it must be capturing someone who has got pretty exclusive access to a group of consumers or users on either side of the platform. They must be meaningful because it can't be tiny, but it must be a meaningful group. Consumers or users that cannot be accessed in other ways. So you are truly a gatekeeper. So that defines you. And so I think that that is the concept that one needs to go to because it is in line with the notion that different businesses will then protect that, will then kind of erect that moat and protect it in slightly different ways. Whether you're an up-funded business or you are a transaction business or you are an app store, an operating system, you will try and kind of erect and protect that moat, preventing competitors to come in in different ways. And so you need to have that flexibility to do it. I understand that the European Commission, of course, didn't want to appear to be prejudging this. So it was important for Brussels to not be too close and personal. And Mike is being candidly saying, look, we've looked at Google and Facebook. Who's next? Well, guess who? Apple, Amazon and Microsoft. What a shock. But then the question is, do we want in there? Who? Do we want Bookings.com? Do we want Expedia? Do we want Netflix? Do we want on what basis? Do we want Airbnb? Do we want who is captured in there? And so I think that, in fact, I heard Mike say, if we are capturing certain companies, we're in their own place, because we have limited resources, we shouldn't be trying to create a huge cohort of gatekeepers, all of whom will be madly arguing, I've got absolutely nothing to do with gatekeeping. I'm not a gatekeeper. We know kind of where the problems are. But of course, and diplomatically, it's important for the European Commission also to be seen and not to pick immediately on five-grade big American companies. So let's kind of set the threshold such that it picks two Europeans, right? And then you're going to have the two Europeans and say, what am I doing here, right? Why am I here? But frankly, if you apply those thresholds, you're going to capture some people who don't belong. Do we worry about Salesforce as being a gatekeeper? I don't think so. But in a world of thresholds, they may well be captured. Ditto for SAP, but worry about Oracle being a gatekeeper, no. But some of these rules might, some of the quantitative thresholds may then apply. So I think one is to take this with a pinch of soul. Quantitative thresholds will kind of capture a number of people, but then I don't think I would lose a lot of sleep if I was Salesforce that put it that way. So one of the things- You know, what, go ahead, Fiona, sorry. One of the things that Chris, just to follow on what Christina said, what we're concerned about in our article is if you've got a rigid screen for bringing in companies, platforms, and you've got a rigid set of rules, then every time you add another company, it's got to follow all the rules. And those rules weren't set up for it. Those rules come from past antitrust cases that the European Commission has been involved in. And so there's a possibility of just being needed to be followed by a company for which it has no relationship and no purpose and possibly a counterproductive purpose. And this is why I think both Christina and I are quite fond of the UK approach because let's say there was a smaller platform causing a problem. Well, if you investigated it, you would probably find that it was a small problem or a narrow problem or something and then its code of conduct would perhaps be quite simple. And I'll just say one more thing, which is if you do a lot of what I loosely call consumer protection work in this sector, that is to say create more transparency, create stop dark patterns, create more interoperability, then you're going to definitely lessen the tale of problems that come from the smaller platforms because they will just be operating in an environment where consumers can do a better job disciplining them. And then that's a really good place to be. So one of the reasons that we talked about an SMS kind of concept in our paper is I love the way that the dominant companies suddenly become very beneficent and start worrying about small companies as this debate goes on. And oh, you can't do this because it will have this impact on small companies that by the way we're trying to crush right now. But it removes that political obstacle and which I think makes a lot of sense. I wanna take seriously that concern about innovation but I think Mike explained as part of his presentation that there used to be these debates and sometimes I still hear these debates about whether innovation is really fostered more by monopoly or competition but we really believe strongly that it is competition that is fostering innovation. So this is actually the best way to promote innovation from disruptive competitors and even from the large ones. Go ahead, Fiona. I have two observations there. I think people sometimes in their mind ask themselves do I see more innovation in wheat farming or in pharmaceuticals? Gosh, I see more in pharmaceuticals and they're more concentrated than wheat farming so there must be some relationship. That's not the question we're asking. We're asking take the pharmaceutical industry, merge all of them together into one giant monopolist, what will happen to innovation, okay? Now nobody's racing against anybody else to develop a treatment obviously the incentives for innovation fall so that you've gotta hold your setting constant when you do this thought experiment. So that's one thing. A second thing is that we're now at a place where a very important source of innovation is on top of the platform, not perhaps a new platform but businesses doing things on the platform. And if the platform is extracting all the rents from them they don't have any reason to innovate. They maybe can't get in. They maybe can't morph their business model a little bit differently. I see Mike nodding. So maybe I'll stop talking and let him follow up. No, sorry. I was just completely agreeing and writing down on what you're saying, Fiona. I can jump in if I may because I feel hugely strongly about this. Every time anyone says something which is pro enforcement then there is a cacophony that says you an economist should know that this kills innovation, right? It is self-evident. Now I've been in this from the days of Microsoft that was working opposite. And at the time the arguments we were hearing from Microsoft were of course if you do intervene this will kill innovation. This was 20 years ago but we've learned since then and it isn't so. We haven't seen this notion that these companies innovate like mad, these digital platforms they're innovating day and night. I've been in a seminar with one of the speakers was saying, do you know they innovate day and night? I'm sure they do. But the point is what is the counterfactual? What would we see without this? We see more for the very reason that Fiona outlines. So I think that the notion as Mike said very succinctly, the idea that competition is the best environment for innovation is kind of done. We're done. We don't have to debate it. It isn't monopoly. Competition only improves innovation. It's the only place to be. And finally, I think a lot of the discussion is also misguided when we hear, oh look we shouldn't really do anything about mergers that actually kill nascent competitors because that is the way in which incentives work. You want the nascent competitor to monetize. His incentive to invent and come into the market is just because he can monetize. One, partaking in the profit of monopolies and the great incentive that we want to encourage. But two, can I just place an example there? I don't want to judge. But the Visa plate case was one that died recently. Play was a company that of course missed the opportunity of being acquired by Visa. The valuation that Visa placed on it was $5 billion. Now that the deal is no longer happening, I read in the public domain that there are offers out there for $15 billion. So it isn't as if you miss an opportunity necessarily and you're dead. There is optionality out there. And I don't think that the discussion about innovation means anything. We also need to remember that the fiduciary responsibility of management is to spend funds to innovate to strengthen their position. Not just for general innovation. Take a look at what happened after the 1956 consent decree required AT&T's Bell Labs to open up their monopoly patent portfolio. We would not have had the internet had not the ability to use the patents that were there on microprocessors, on modems, on data recording and other kinds of things been opened up to all rather than being constrained by the corporate incentives saying no, we're only going to innovate in ways that help us. The classic example, and then I'll shut up, is Bell Labs, the guy at Bell Labs invented digital tape and it's this thing called a telephone answering machine. And it was squashed because the higher ups at AT&T said, wait a minute, if people can leave messages then they won't use their phones that much. Innovation inside a corporate institution is driven for the benefit of that institution, not for the benefit of the internet. For the benefit of innovation. Such an important point. I'm sure you can see we're down to our last two minutes. I really wanna get to this great audience question. This is from Connor May. Professor Scott Morton did answer this in the chat but I think it would be great to have a conversation about it as well. Connor asks, what role do you see for structural separations as a remedy? If structural separations are used, does that obviate the need to police search algorithms for vertical discrimination or do authorities still need to figure out a way to scrutinize platforms algorithms to prevent collusion, favoritism or preferencing in search results? Thanks Connor for that question. Well, I'll just say divestitures are a great tool. They're very clean, they're very powerful. So if we got to the end of the Google case and the court said, look, Android should be divested from search or ways should be divested from Google. I think those are very good plausible types of remedies that could help kickstart competition again. However, on the question of algorithms and bias, I think there are plenty of businesses that are not vertically integrated. They do whatever they do and they could be biased or the algorithm could learn to discriminate. So I for myself would like to see a more robust regulation around discrimination and bias so that we don't have ads for good paying jobs going to men instead of women and ads for dubious financial products going to low income consumers. I know Mike has a, the CMA has a great history of going after these things and there are a lot of them. So can I just, in that context, say, I mean, we actually published on Tuesday this week a paper of algorithms, how they can reduce competition and harm consumers, which is our attempt to encapsulate what we know about algorithms in this area and to encapsulate that and to try and simulate some more work and debate on that issue because it's just not the case that algorithmic harm is just the result of firms being big or being large platforms. It can be in the nature of just bad competitive outcomes. So that's a publicly available paper that we published on Tuesday. Great. Well, with that, unfortunately, we have to wrap it up. Thank you so much to our panelists and our presenter. This has been an incredible discussion and I really appreciate you taking the time. Folks, Michelle will share with you the documents that we have been talking about today in an email after the fact. So thank you all so much. I'm really hopeful for how the US can move forward with a lot of these great ideas. Thank you, Charlotte. Thanks everybody. Thanks Charlotte. Bye-bye everyone. Thanks.