Steering digital titans away from monopoly's edge

The Digital Competition Act aims to curb Big Tech's monopolistic grip, ensure fair play, and foster innovation in India's rapidly evolving digital economy

- DR JAIJIT BHATTACHARYA & SUHASINI BHATTACHARYA

The digital economy is increasingly becoming monopolistic, with a handful of large players dominating major market segments. This concentration of power has led to mounting concerns about anti-competitive practices, particularly among “Big Tech” companies, which typically dominate digital platforms.

These digital monopolies stifle competition by controlling significant portions of the market and engaging in anti-competitive practices such as charging exorbitant fees, controlling access to key services, or dictating terms to smaller businesses that rely on their platforms.

A clear example of this behaviour was when Twitter refused to take down content that violated local laws in India. By doing so, Twitter asserted its dominance over online discourse and subverted the authority of the Indian government, which eventually had to step in to enforce content removal.

Such instances highlight the serious challenge digital monopolies pose to a free and competitive economy. These platforms leverage the network effect to become essential infrastructures businesses depend on, supporting millions of jobs. However, this power can quickly become a means to smother competition and, more alarmingly, undermine governmental authority, which demands immediate attention.

THE CASE FOR PROACTIVE REGULATION

While digital monopolies may initially appear beneficial due to the jobs and economic activity they generate, their potential to stifle competition, engage in significant anti-competitive behaviour, and disregard government authority has become increasingly evident. No government can afford to dismantle large businesses that underpin vast sections of the economy. However, allowing these monopolies to operate unchecked threatens national sovereignty. This underscores the urgent need for proactive regulation to prevent such scenarios.