Abstract
Gatekeepers are intermediaries who help businesses to get more consumers, however, they have their own interest and take market dominance based on the same. They try to charge huge amounts as fee from the businesses and take consumer data. But, they have their own profits as their goal and promote their products much better than the third party products. This requires for more government control on gatekeepers functioning and for new regulations for gatekeepers to protect third parties and the consumers and improve competition in the market.
Introduction
Gatekeeping is the process of controlling who shall get certain resources, powers or opportunities and who shall not. It can be a show of authority by a person in power in determining who shall get access to what. Digital platforms are business models that use online infrastructure to facilitate interactions between groups. Digital platforms connect buyers and sellers, and many businesses use digital platforms to increase their profits. They help in setting prices and help establish trust in the consumers. Digital platforms can be social media, knowledge platforms and service-oriented platforms. Digital platforms also help gain market dominance by a certain business due to extended customer reach, building of trust, cost reduction and efficiency. Gatekeepers are the intermediaries in digital platforms that impose unfair conditions on business users and their prospective customers.
Keywords
Gatekeepers. Digital platforms, market dominance, competition laws.
Gatekeeper Powers
A gatekeeper in the digital market generally refers to a company or platform that controls access between groups, such as users and third parties. They often hold significant market power. The gatekeeper sets rules that the buyers and sellers must follow as they give them access. Gatekeepers can either control access of third parties to their users or control access to content or products. Gatekeeper powers can be linked to a bottleneck. A bottleneck is a market situation where one platform is a viable access point only for certain users and businesses. This leads to economic dependency, which increases the power in the hands of the gatekeepers because there is no other amiable alternative available to the business.
Gatekeepers also control the flow and accessibility of information and shape how people interact in the digital environment. Gatekeeping creates dependency and gives more than required powers to the gatekeepers, as the businesses are dependent on them for their growth, and they need to reach their required consumer base.
Regulatory Approaches to Managing Gatekeeper Powers
The Digital Markets Act is a regulation enacted by the EU to promote fair and transparent digital markets by limiting the power of gatekeepers. It typically applies to platforms with a substantial position in the digital markets that exercise control over the access to significant digital ecosystems. The DMA brings proactive obligations on gatekeepers to prohibit unfair practices and to improve competition.
These obligations include ensuring that third parties can cooperate with the gatekeepers cannot rank their own products or services more favourably than those of their competitors. The DMA also mandates transparency around data usage and advertising, obliging gatekeepers to allow users to uninstall pre-installed apps and to facilitate data portability. Margrethe Vestager, Executive Vice-President for Europe Fit for the Digital Age, emphasized that the DMA represents a proactive approach to reshape the digital landscape f to ensure gatekeepers compete fairly, thereby fostering innovation and providing more choice for consumers. The Act encourages ongoing dialogue between regulators, gatekeepers, competitors and consumer organisations to optimize its implementation and effectiveness.
In India, the Parliamentary Standing Committee on Commerce recommended the introduction of a gatekeeper’s regulation in India. Simultaneously, the country’s competition regulator, the Competition Commission of India (CCI), has reportedly started setting up a dedicated Digital Markets and Data Unit (DMDU). though there are a few models of gatekeeper regulation to choose from, the Parliamentary Standing Committee’s skeletal recommendations seem to be aligned with the DMA, while the CCI’s move of creating a DMDU mimics the UK’s strategy. While regulatory transplant in India (i.e., import of legislative frameworks from foreign jurisdictions) is neither uncommon nor decidedly undesirable, it is important to customize these laws to the unique legal, social, and market conditions of India.
Challenges in Enforcing Competition Law Against Gatekeepers
In the Indian market, the big tech firms leverage their dominance to create entry barriers to smaller competitors. Google has faced scrutiny for prioritising its own services in search results, proving a disadvantage to smaller businesses and start-ups.
There is a vast amount of consumer data which is collected by big tech companies. The vast amount of consumer data collected allows them to engage in personalized advertising, often giving them an unfair advantage over smaller players. This serves as a main driving point in making businesses approach the gatekeepers to boost business, and makes gatekeepers charge them high prices and require them to follow a huge amount of regulations and restrictions. The overlap between competition laws and data privacy regulations creates challenges for regulation.
Many big tech platforms which operate as gatekeepers control access to key digital markets. The Competition Commission of India had instigated allegations against companies for favouring their own products and gaining market dominance over third-party products and services, as seen in the instance of Amazon and Flipkart, where their own products are promoted first. There is a lag in regulation and enforcement. The pace of technological advancements often outstrips regulatory responses. Unlike traditional markets, digital platforms operate globally and require international cooperation for effective enforcement, India’s competition laws need continuous updates to address digital market complexities. India’s enforcement provisions should start aligning with that of the European Union and the USA which have imposed stringent antitrust laws.
Conclusion
Gatekeepers are intermediaries who help businesses to get more consumers, however, they have their own interest and take market dominance based on the same. It is therefore necessary for stringent anti-trust laws and proper enforcement to keep the gatekeepers on check.
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WRITTEN BY: I Sharan
