This Master's Thesis researches problematic aspects which EU Competition law faces when applying traditional static metrics, such as market shares, price levels and profit margins to digital markets.
The thesis first introduces the reader to the subject, sets the framework and poses the research questions. It commences by outlining the restrictions in vertical agreements (vertical restraints) in traditional markets under EU Competition law and explains under which circumstances vertical agreements benefit from Vertical Block-Exemption Regulation.
Further, the thesis shifts from traditional markets to digital markets. It first of all contrasts the distinctive structure and dynamic nature of digital markets, emergence of new business models, and the role of data in competition between platforms and lock-in effects. Furthermore, thesis discusses digital markets, in particular multi-sidedness of digital economy with two-sided transaction markets and two-sided non-transaction markets. It discusses the complexity of digital markets, problematics of market definition, in particular fluidness of market boundaries, substitutability of digital goods/services and zero pricing. It points out challenges which competition law faces in determining the relevant market and establishing infringements under Articles 101 and/or 102 of TFEU.
Furthermore, thesis analyses a legality of imposition of vertical restriction (geo-blocking) in digital content distribution. It discusses whether imposition of geo-blocking restrictions in agreements unduly restricts competition and whether the restrictions in turn could be justified by the consumer efficiencies. It analyses the clash between fundamental freedom, i.e. freedom to provide services, restriction of competition in online content distribution and protection of legitimate rights under Copyright law. It also discusses whether these issues should be resolved by competition law or whether amendments of other fields of law, e.g. Copyright law, Data protection law or Consumer law is a more feasible solution.
The thesis concludes with answering the research questions, in particular, which steps and in which order should competition authorities conduct their investigations. Thesis also concludes that under normal circumstances geo-blocking does not restrict competition in non-licensed territory, provided imposition of geo-blocking restriction does not facilitate absolute territorial protection.
