Rethinking modes of evaluation of market dominant power for multi-sided platforms

Abstract

As mobile internet is currently proliferating, multi-sided platform operators such as Google and Apple mediating transactions between customer groups play a major role in forming market environment. In this regard, traditional tools of evaluating market dominance are required to reflect features of multi-sided platforms. Thus, existing judging factors of assessment of market dominant position such as market share and entry barrier should be modified to fit in with multi-sided platform market. In addition, special features of multi-sided platform market such as indirect network effects, multi-homing, dynamic innovation should be considered. The Korea Fair Trade Commission (hereafter the KFTC) and Korean courts heavily rely on market share based on the provision of presumption of market dominant position in evaluating market dominant power. However, there are some cases reflecting features of multi-sided platforms such as indirect network effect multi-homing and market dominance leveraging theory. As multi-sided platform business is developing continuously, competition authorities and courts are required to mirror changing market environment to secure fair competition and consumer welfare. Furthermore, as the importance of personal customer data with regards to market dominance leveraging phenomenon is increasing, market dominant power of platform operators should be examined more comprehensively.