Competition Between Platform Owners and App Developers Doesn’t Harm Innovation, Yet Policymakers Insist on Discriminating Companies Based on Size, Says ITIF

December 15, 2021

WASHINGTON—Following the Senate Judiciary Committee hearing on the impact of consolidation and monopoly power on American innovation, the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, released the following statement from Julie Carlson, ITIF’s associate director of the Schumpeter Project on Competition Policy:

Policymakers keep focusing on the misguided notion that large technology platforms are bad for small businesses, workers, consumers, and innovation. Yet the flourishing digital innovation ecosystems that exist today result from past and ever-increasing R&D investments made by the disruptive platforms Congress now seeks to regulate. 

As such, competition between platform owners and app developers on their platform is not necessarily harmful to developers or innovation. Similarly, competition between large and small firms is not necessarily harmful to the innovation potential of small firms. On the contrary—imitation can lead to profitable innovation and benefit consumers. 

Discriminating against larger firms because of their size will likely result in higher prices and fewer innovative products. Antitrust enforcement should only rely on the rule of reason; any other approach could deeply harm United States competitiveness and innovation. 

Twitter Image: 
Competition Between Platform Owners and App Developers  Doesn’t Harm Innovation, Yet Policymakers Insist on  Discriminating Companies Based on Size, Says ITIF