Digital Markets Unit risks stifling investment and innovation
25 April 2023
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Commenting on the introduction of The Digital Markets, Competition and Consumers (DMCC) Bill, the IEA’s Director of Public Policy and Communications Matthew Lesh said:
“The Digital Markets Unit will have extraordinary powers to direct business operations and relationships with third parties. Companies could be forced to ask for permission before launching products or required by the regulator to modify features in ways that undermine user privacy. These interventions risk making the UK a hostile place to invest and innovate.
“Digital markets are highly dynamic, competitive and unpredictable. This can be seen from the downfall of MySpace to the recent rise of ChatGPT challenging Google and TikTok challenging Facebook. The largest companies spend tens of billions on research and development and employ thousands of people in the UK. The Competition and Markets Authority already has extensive powers and the case for more is weak.”
ENDS
Notes to Editors
CONTACT: media@iea.org.uk / 07763 365520
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.
“The Digital Markets Unit will have extraordinary powers to direct business operations and relationships with third parties. Companies could be forced to ask for permission before launching products or required by the regulator to modify features in ways that undermine user privacy. These interventions risk making the UK a hostile place to invest and innovate.
“Digital markets are highly dynamic, competitive and unpredictable. This can be seen from the downfall of MySpace to the recent rise of ChatGPT challenging Google and TikTok challenging Facebook. The largest companies spend tens of billions on research and development and employ thousands of people in the UK. The Competition and Markets Authority already has extensive powers and the case for more is weak.”
ENDS
Notes to Editors
- In July 2022, the IEA published Powering Up: How will the Digital Markets Unit affect competition and innovation? by Victoria Hewson and Dr Cento Veljanovski.
- In February 2023, the IEA published Breaking the News? Should digital platforms be required to fund news publishers? by Matthew Lesh
CONTACT: media@iea.org.uk / 07763 365520
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.
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