Within and tech M&A

Lina Khan, the head of the FTC, first became known for a law school paper arguing that US antitrust policy in recent decades has become far too narrowly focused on low consumer prices as the only test for harm, ignoring choice, competition and innovation, and that Amazon was an exemplar of this, since it uses its market power in ecommerce to push prices down, not up.

The paper was somewhat flawed by its unquestioning acceptance of the myth that Amazon sells a loss and is subsidised by investors, neither of which have been true for some 20 years, but the general analysis of US policy is perfectly valid, and while it wasn't really a new observation, the paper probably catalysed a shift in conversation about antitrust policy in the USA.

Of course, one could argue that this shift has also been driven by how much bigger leading tech companies have become in the last decade (simply because tech has become so much bigger), and how much more central to our lives (and politics) tech has become. There are plenty of US industries that look a lot less competitive than tech (meat-packing, for example), but tech is new and different and much more visible, and politically friendless. So it’s in the crosshairs, and Biden appointed Khan to the FTC with that mandate.

A second strand, meanwhile, is that this general shift in attitude towards companies with large market shares, particularly in tech, is accompanied by a new degree of attention paid (Read more...)