Digital platforms are characterized by their network effects and by being multisided, as well as by having high switching costs, economies of scale and levels of control of data, all of which are pertinent in the definition of the relevant market.

 

Regarding digital platforms, there is consensus that each side should be defined as a separate relevant market as long as consumers, advertisers, content providers and any other agents involved do not engage in transactions with each other. Products are generally perceived to have different degrees of substitutability on each side of a platform.

 

EE&MC uses established tools like the hypothetical monopolist test, that primarily relies on a price mechanism, in an adapted manner. Instead of simulating a price increase, the economic effects of a decrease in quality are observed and used for defining a relevant market. To define a multisided market, also data flows that may be observed in the market can be used.

 

EE&MC is applying this adapted methodology already in the last 15 years and has a strong record on market definitions in digital platform markets.  

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