Governments around the world seem to be on a path to turn the leading tech firms into public utilities. Interoperability is likely to be one of the relevant tools for doing that, but history has shown that it would be incredibly difficult and costly.

The House Judiciary Antitrust Subcommittee is holding hearings on antitrust and Big Tech to move towards new legislation that would regulate online platforms. One of the key issues raised during the first hearing, held on February 25, was interoperability. To put it simply: When does a platform have to make available all or parts of its platform to another firm that wants to build its business around the platform? Rep. Joe Neguse (D-CO), who tweeted on this after the hearing, believes that there is bipartisan support to move forward to pass new laws requiring gatekeepers to create more interoperability with their platforms.

The above question is a well-known issue in antitrust and regulated industries, and history makes clear that forced interoperability is almost never easy to do. Governments around the world seem to want to turn the leading tech firms into public utilities and seem to assume that they can do so with minimal cost. That seems unlikely.

When it comes to how interoperability might be applied to the major online platforms, the draft Digital Markets Act of the European Union, released on December 15, 2020, would first create new obligations for what it terms gatekeepers. One of those obligations would apply to gatekeeper online search engines—Google isn’t namechecked, but is the obvious target—and would then require the gatekeeper search engine to “provide to any third party providers of online search engines, upon their request, with access on fair, reasonable and non-discriminatory terms to ranking, query, click and view data.” In other words, Google would be forced to sell its data to competitors at a price regulated by the government—forced wholesaling.

Read more at ProMarket