Internet Competition and E-Books: Challenging the Competition Policy Acquis?

Relative ease of entry and rapid innovation are core characteristics of competition on the Internet, but, at the same time, a substantial number of successful Internet-based companies detain very strong positions on their relative markets. A legitimate question, therefore, is the extent to which the workings of “competition on the Internet” might differ from the more traditional market characteristics of the brick and mortar world, and whether competition policy as applied in this newer context would require taking account of special considerations. An interesting “case study” in this respect is the market for e-books, which lately has been the object of intensive scrutiny by competition authorities on both sides of the Atlantic. The brief discussion of the competition proceedings confirms that policy intervention in digital markets requires extra caution by authorities and courts, especially when there are network effects at work. More generally, casting Internet competition into the broader “vertical restrictions” picture can give rise to partly new insights for competition policy, such as, for instance, that being a “typical” discounter in the digital era does not preclude providing many of the pre-sale services customers value.