Governments and institutions are learning how to respond to platform power. The response is slower than the power it is addressing.
The Institutional Response Lag
Platform power — the concentrated market and governance power that major digital platforms have accumulated through network effects, data accumulation, and infrastructure control — has grown faster than the institutional response to it. The decade from roughly 2010 to 2020 was a period of platform power accumulation with minimal effective institutional constraint. The institutional response that has developed since reflects genuine recognition of the harms that unconstrained platform power produces and the lag between recognition and effective implementation. The EU's Digital Markets Act, various national data protection frameworks, and renewed interest in competition enforcement represent genuine institutional learning applied to a power configuration that has already been established.
What Effective Response Requires
Effective institutional response to platform power requires analytical frameworks calibrated to the specific features of platform markets: the network effects that make market position durable once established, the data advantages that create barriers to competition, and the multi-sided market dynamics that make traditional market definition inadequate. The traditional competition framework focused on price effects and current market shares misses the dynamic competition effects and zero-price market dynamics that characterise platform competition.
The institutions responding to platform power are writing new rules for new market structures — which requires the institutional learning that only accumulated experience with those structures provides. The lag between the power's establishment and the response's effectiveness is the period during which the power becomes entrenched enough to resist the response.
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