Open source but anti-competitive? A discussion of the EC’s case against Google

The European Commission recently issued a Statement of Objections explaining its preliminary view that Google has behaved anti-competitively in the EU in respect of its Android operating system (OS) and apps. This development is somewhat counter-intuitive, given that Android is an open source operating system, which should in theory should make it easier, not harder, for competitors to develop competing operating systems based on Android. In this article, we try to unpack the EC’s objections in order to resolve this apparent paradox, and then consider some of the possible counter arguments that Google might make.

David against Goliath: does competition law deter large firms from engaging in predatory conduct?

In September 2015, the Competition Tribunal found that Media 24 had contravened the Competition Act by engaging in a predatory strategy in order to eliminate a small competitor in the community newspaper market in Welkom.[1] The Tribunal found that the prices Media 24 had charged prices for advertising for one of its two titles in Welkom were lower than its cost of producing the newspaper over a sustained period. As the newspapers were distributed for free to readers, advertising costs were the only available source of revenue, so Media 24 was operating the paper at a loss. The Tribunal moreover found that Media 24 had done so with the intention of eliminating its competitor, and that following the exit of the competitor it had raised prices in the market in order to recoup the earlier losses. This had harmed customers (both advertisers and readers) by reducing price competition and limiting choice.

The case against OTT regulation

The advent of new technologies continues to disrupt competition in a number of traditional markets, many of which have operated in the same manner for decades. Examples of this include the metered taxi industry (Uber is quickly becoming both a noun and verb in South African conversation) and the television industry (hello Netflix!). From a telecommunication point of view, so-called Over-The-Top (OTT) communication providers such as Whatsapp, Wechat, and even Facebook Messenger, have revolutionised the way in which we communicate.

Can mobile money drive competition in financial services in South Africa

Anyone who has recently spent time in Kenya, Zimbabwe or Tanzania could not help but notice the pervasive influence of mobile money on everyday life. Mobile money has changed the nature of payments in these countries, lowering transaction costs, driving financial inclusion and providing consumers and small businesses with easy, cheap and safe ways to transact. Even a cursory comparison reveals that South Africa is lagging far behind in terms of both uptake and innovation. A number of attempts to launch similar solutions in South Africa have failed, although more recent efforts such as MTN’s mobile money offering appear to be more successful. Is South Africa’s divergent experience a result of its sophisticated banking system and different customer demographics? Or is a highly restrictive regulatory environment to blame? This blog, based on research done with the Centre for Competition, Regulation and Economic Development at the University of Johannesburg, attempts to unpack this complex market and analyse some of the reasons we are so far behind our regional peers.