Q 12. Now, shifting briefly to current events. There was some big news the past few weeks, both here and globally, concerning US Senator Elizabeth Warren’s call to break up the big platform companies. She’s not the only one. What is your take on her proposal and the other calls to break them up?
A. While I share at least some of Senator Warren’s her concerns, I don’t believe breaking up the platforms is the best answer, at least at this juncture.
Traditionally, policymakers use three kinds of policy tools to solve issues they seen in the market. Each has its place, depending on the context.
Transparency remedies -- compel companies to show to the general public more of their practices
Behavioral remedies -- compel companies to do what they would rather not do, or to refrain from doing something they want to continue doing. Most forms of regulation fall into this bucket.
Structural remedies -- separate out the bad activities from the good activities; the breakup of AT&T, and the proposed breakup of Microsoft, are two examples.
There is a fourth option, however, what I call functional remedies.
This entails finding ways to inject certain inputs into the system to facilitate, let’s say, more competition. Interestingly, the US Federal Communications Commission (FCC) has been a leader in this “functional openness” space over the last forty to fifty years, using targeted interventions to enable more innovation and competition in telecommunications. Here is a paper I just wrote on that topic.
Functional openness inputs can be a variety of things, but in the tech sector they tend to be one of two things.
First, software-based mediation points -- protocols, standards, interfaces. Second, hardware-based, physical mediation points -- interconnection and interoperability, for example. These software and hardware inputs, if done correctly, can open up new ways for entities to enter markets and compete.
In the GLIAnet model, opening up common interfaces -- between, say, Amazon’s Alexa AI and the GLIAnet Avatar -- would create the ability to facilitate new modes of choice and autonomy for users, and new market opportunities for their chosen TrustMediary.
That doesn’t mean the transparency and regulatory and structural approaches also can’t be pursued in parallel. And they may well help support each other in various ways. But I prefer working on functional remedies, because I believe they have great potential to result in abiding and concrete forms of competition, innovation, and user choice.