On the 5th of July our director Hans W. Friederiszick chaired a special policy session on this year’s CRESSE – Competition and Regulation European Summer School and Conference.

This session covered current developments and challenges relating to the topic “Ecosystem Competition: Access Charges, Fairness, Interoperrability”.

It was a great exchange with the internationally recognised experts and panelists Marc Bourreau (Télécom Paris), Giuseppe Colangelo (Università degli Studi della Basilicata), Jacques Cremer (Toulouse School of Economics), Eliana Garces (Analysis Group), Simon Loertscher (University of Melbourne) and Keith Waehrer (Secretariat Economists).

CRESSE is a network of academics and professionals, practicing in competition or regulatory authorities, consultancies and legal practices, with an interest in competition policy and sectoral regulation. It was initiated by Prof. Yannis Katsoulacos in 2005. E.CA has the honour of being a long-standing partner and we are very grateful for this cooperation.

The European Commission has published the report “Exploring Aspects of the State of Competition in the EU” on June 24 2024.

The report was prepared by a consortium of firms led by Lear and comprising E.CA Economics, Fideres, Prometeia, the University of East Anglia, and Verian. Our report has contributed to the Commission’s own report entitled “Protecting Competition in a Changing World”, also published on June 24 2024.

The chapter we contributed defined “Global Superstars” as the world’s 50 most profitable companies for five 5-year periods between 1998 and 2022.

Click here to read more.

At the beginning of June our directors Linda Gratz and Hans W. Friederiszick gave a presentation at the 2024 Hal White Antitrust Conference. This event was organised by our US partners Bates White Economic Consulting.

Our directors spoke about bargaining power in the bilateral negotiations between carriers and large Content and Application Providers (CAPs) over IP data transport fees.

In a recent legal dispute between Meta and Telekom Deutschland GmbH, Meta stopped paying fees while continuing to use a dedicated direct network connection into Telekom’s network, with both parties accusing each other of abusing a dominant position.

In this context, our company analysed the relative bargaining power of carriers and CAPs in the bilateral negotiations over fees for IP data transport.

We concluded that carriers technically cannot deny access to their network. Furthermore, large CAPs can deliberately cause congestion at interconnects into a carrier’s network, thereby temporarily deteriorating the connection quality in the network. Consequently, a significant imbalance in the relative bargaining power in favour of large CAPs can arise.

The dispute between Meta and Telekom could become a precedent for establishing whether CAPs must pay for using dedicated direct connections to carrier’s networks and contribute their share to the necessary investment into Next Generation Networks.

We thank Bates White for inviting us to speak at the conference. Thank you also to our clients for the opportunity to share our analysis and engage in such an important discussion.

This year E.CA Expert Forum took place at the Fondation Boghossian (Villa Empain) in Brussels on 30 May.

You will find a summary of the panel discussions regarding “Self-preferences and AI” and “The role of competition policy in the transformation of the European economy” below. We also summarised our key take aways from the closing remarks by Olivier Guersent.

A big thank you to the speakers, participants and for everyone else who contributed to the success of our event.

Click here for a summary of the panel discussions and photos.

E.CA Economics has won the Antitrust Writing Award. Our “EU publication on State aid: E.CA supports DG Competition with revision of Railway Guidelines” was awarded in the category “cross-border”. Congratulations to our directors Elzbieta Glowicka and Anselm Mattes and all other involved colleagues. The study was conducted by a consortium lead by E.CA and included LEAR, Sheppard Mullin, UEA and the Institute for Transport Studies at the University of Leeds.

Click here if you want to read more details about the study and the results.

The new edition of the European Competition Law by Prof Helmut Schröter, Robert Klotz, and Bernhard von Wendland was published recently.

Our director Hans W. Friederiszick and associate principal Rafael Aigner contributed the chapter “The role of economic analyses in the enforcement of European antitrust law”.

This reference work for competition law covers the entire field of antitrust and merger law with all procedural rules, enriched with commentaries and interpretations by relevant experts.

The fact that we were able to participate in this standard work is a nice proof of how much our expertise is recognised and appreciated in the industry.

The book (ISBN 978-3-8487-6325-2) can be ordered via this link.

On the 22 March 2024 the conference “Dynamics of Generative AI” will take place in Berlin. The central question that will be discussed is: What will define the future of AI ecosystems? The conference is co-hosted by the Weizenbaum-Institut and the Amsterdam Law & Technology Institute.

At the event lawyers, economists, computer scientists, and social scientists will gather their knowledge to find answers around this question.

E.CA Economics is proud that our director Elżbieta Głowicka has an active part in the discussion. She will talk about how vertical partnerships and/or integration in the GenAI value chain can facilitate competition in GenAI products.

On March 11th, our manager, Pauline Affeldt, delivered an insightful presentation on Big Tech acquisitions in the app industry at the W@CompetitionDE Talk DMA – Let’s go! in Berlin, an event co-organized by Elżbieta Głowicka and Pauline Affeldt and hosted by Blomstein. The event was attended by over 50 participants who engaged in lively discussions centered around the Digital Markets Act and the legal and economic challenges in implementing and enforcing it effectively.

The key insights from the talk were:

• The DMA is the first ex ante regulation of big tech firms and it reverses the burden of proof compared to competition policy tools.
• In best case, the DMA will lead to more competition on the existing platforms and help firms at the edge of becoming big to compete with gatekeepers.
• The panelists agreed that it is unclear whether the DMA will be able to significantly lower the market power of gatekeepers.
• Gatekeepers have many means to secure their position, since many business practices are difficult to prove and transparency is missing.
• The ban on self-preferencing might lower commissions for third-party sellers, but it is also likely to affect the profitability of product offerings by the hybrid platform.
• Transparency of gatekeepers’ acquisitions may facilitate more transactions being investigated and remedied or prohibited under merger control.

Pauline highlighted in her presentation that most Big Tech acquisitions were not investigated by competition authorities since they did not reach traditional notification thresholds of merger control that look at turnover or the number of employees. Under the DMA, gatekeepers will now have to inform the European Commission about all their acquisitions. This increased transparency of gatekeepers’ acquisitions may facilitate more transactions being investigated and remedied or prohibited under merger control. Pauline further presented her joint research with Reinhold Kesler investigating competitors’ reactions to GAFAM acquisitions using data from the Google Play Store. The results show that competing apps innovate less following app acquisitions by GAFAM. In addition, affected developers reallocate innovation efforts to unaffected apps and affected markets experience less entry post-acquisition.

Full presentation can be found by the link.