Research On Market Barriers And The Determination And Regulation Of Platforms’ Monopolistic Acts

Taking advantages of two-sided market,platform enterprises achieved rapid market expansion,which not only promoted economic and social development,but also enhanced the risk of monopoly.At present,the international community has formed a consensus to strengthen the anti-monopoly of platforms.However,relevant theoretical researchs and cases have found that it is difficult to identify and regulate the monopoly behavior of platform enterprises.How to improve the anti-monopoly efficiency of the platform market so as to give full play to the advantages of scale and competitive efficiency of the platform market has become the focus and difficulty of anti-monopoly in the platform market.Starting from the competitive market theory,this paper studies how to identify and regulate the monopoly behavior of platform enterprises through market barriers under the framework of the competitive platform market,so as to realize the healthy development of the platform economy.The existing literature provides the following research bases:First,the cost structure such as high sunk cost and low marginal cost and the network externalities in platform markets are significantly different from traditional industries.Second,the traditional antitrust system based on the theory of perfectly competitive market is difficult to identify and regulate the monopolistic behavior of platform enterprises.Third,a more suitable theoretical basis and regulatory tools are needed to objectively evaluate the competitive efficiency of the platform market.Based on the research above and the theory of contestable market,this paper studies the competitive efficiency of the platform market.Taking the formation and regulation of platform market barriers as a clue,this paper identifies and regulates the monopolistic behavior of platforms.Competitive market theory suggests that in a market without barriers to entry,potential entrants can pose a threat to the incumbent firm,making it difficult to monopolize and achieve"Ramsey optimality".By the theory of competitive markets and the theory of platform,we can get the benchmark model of the competitive platform.The results of the benchmark model indicate that in a competitive platform market without barriers to entry,the incumbent platform will give up monopoly pricing and monopoly profits to achieve "peaceful coexistence" with potential entrants.in this case,the platform market is contestable.The formation of platform market barriers relies on the amplification effect of network effects on sunk costs and government licenses,which are specifically,data barriers and innovation barriers.Barrier to entry of platform market which is an important basis for evaluating whether the platform market is competitive can be used to identify and regulate the monopoly of platform.According to the Anti-monopoly Law,starting with platform market barriers,this paper studies examines the determination of platform dominance,the identification of platform monopoly and the regulation of platform monopoly.Firstly,presume platforms’ dominant market positions by the barriers to entry.Define the platforms’ relevant market.According to the existence of network effects,platform enterprises are divided into transaction intermediary platforms and cross-subsidy platforms.After controlling the network effect,the transaction intermediary platforms’ relevant market can be defined independently by the demand substitution or the product characteristic substitution.The relevant product market of the price chain market and free service market of the crosssubsidized platforms can be defined respectively by the SSNIP test and the SSNDQ test.The relevant geographic market of platforms should be based on the influence of network externalities or price subsidy strategies.Presume the platforms’ dominant market positions by summarizing the Anti-monopoly Law(or Competition Law)and platform antitrust cases,it is found that market share is the basis for achieving the network effect,and only under the network effect,platform market barriers can hinder potential entry into the platform.By mathematical modeling and simulation,it is found that platforms with high market share can use data barriers and algorithmic pricing to drive competitors out of the market,and high market share,network effect and data barriers are necessary conditions for platform enterprises to hold dominant market position.Based on the researches above,we can get the basic process of presuming the platforms’ dominant market positions of by market barriers.Secondly,the monopolistic behavior of the platform is determined by the existence of market barriers and loss of social welfare.China’s State Administration of Market Supervision identified monopoly platforms’ Exclusive Choosing and exclusive copyright licenses as monopolies.However,under different market structures,the loss of social welfare of Exclusive Choosing and exclusive copyrights is different.We consider the market barriers and the loss of social welfare rather than the loss of benefits for small platforms or the loss of welfare for users on platform as the criteria for determining monopoly.The first research topic is the relationship between the transfer cost barrier and the determination of Exclusive Choosing.When the platform requires the undertakings on platform to sign Exclusive Choosing,the transfer cost of the undertakings on platform becomes the "transfer cost barrier" for potential entries.By constructing a mathematical model and calculating,I found that in a platform market without transfer cost barriers,the Exclusive Choosing will not affect the social welfare.The transfer cost barrier is a necessary condition for the loss of social welfare,and the higher the transfer cost,the greater the loss of social welfare.The second research topic is that the competitive efficiency and monopoly losses of exclusive rights agreements vary by size.Exclusive copyright agreements can decrease transaction costs and increase the enthusiasm for copyright protection,but excessive concentration of exclusive copyrights will exclude competition and constitute a monopoly.By constructing a mathematical model and calculating,I found that the exclusive copyright of complete monopoly and the complete cancellation of exclusive copyright cause social welfare losses due to transaction costs and monopoly pricing respectively,and only the exclusive copyright with limited scale can achieve the optimal level of social welfare.Therefore,the SAMR’s ban on "lifting exclusive copyrights" has a tendency to over-regulate.Thirdly,eliminate market barriers and regulate platforms’ monopolistic acts.Platform market barriers rely on network effects brought about by high market shares,and their existence is relative.Therefore,platform market barriers can be regulated by reducing sunk costs,eliminating special licenses and eliminating relative market share advantages,in order to regulate platform monopolies.Potential entrys in the monopoly platform market face two major market barriers:the data barrier and the innovation barrier.Data barriers come from the monopoly of platform companies over user data on the platform,making the data assets of users on the platform a sunk cost.on the basis of the property rights of data,it is possible to break the lock-up of the data assets of the operators on the platform by data portability.Eliminate transfer costs barriers to regulate monopoly "two-for-one" agreements.Currently,the Digital Services Tax(DST),which addresses issues such as Base Erosion and Profit Shifting(BEPS),has become a new data barrier in the international platform market.Replacing the DST with data tax not only solves BEPS,but also redistributes digital economy dividends and restrains the monopolistic acts of cross-border service platforms effectively.The formation of innovation barriers relies on network effects that change the expected benefits of innovation for potential entrants.on the one hand,break the market barriers by establishing public management service organizations to restrict the high occupancy of exclusive licenses for technical standards,patents,copyrights,etc.on the other hand,regulate the domestic monopoly of platform with international vision,introduce international competitive platforms by access licenses for national market to break the market barriers and promote the upgrading of domestic platform market.The platform market is a new trend and challenge in the antitrust field,and the formation of platform market barriers has a new logic.It is scientific to understand the new features of platform monopoly act from the market barriers,but its applicability still remains to be tested by more antitrust practice.