Antitrust regulation of product ecosystems: The case study of Kaspersky Lab. – Apple Inc.

Abstract

Implementation of the ecosystem business model can not only bring significant gains to a company, but also entail additional risks, including those of violating antitrust laws. The article analyses the Apple Inc. ecosystem, which has recently become the subject of a number of complaints from independent software developers and of antitrust investigations. The study shows how a unique position within the ecosystem can lead a company to market dominance. As a result, actions aimed at creating preferential conditions for the company’s services can be interpreted as restricting competition through fostering a discriminatory environment and preventing independent software developers from entering the market. The analysis is based on public information about Apple’s actions against third-party developers and the recent investigation into the company’s conduct in response to the complaint by Kaspersky Lab. The reason for the initiation of legal proceedings was Apple’s actions setting new rules for the App Store and resulting in improper functioning of the parental control application “Kaspersky Safe Kids”. Methodologically, the study relies on ecosystem theory and the theory of industrial organization. The main research method is case study. The research demonstrates how Apple’s actions can be interpreted in terms of such concepts as essential facilities, tying practices, aftermarkets, and leveraging of market power. These concepts are applicable to Apple’s conduct, including the closed type of the ecosystem built by the company.