The treatment of killing acquisitions by GAFAM : Antitrust implications

Rahmine A.

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The treatment of killing acquisitions by GAFAM : Antitrust implications

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Themes

GAFAM Google Apple Facebook Amazon Microsoft, Antitrust laws, companies, acquisition, killing acquisition, unreported acquisitions, digital economy, digital industry, data, high-tech, start-ups, funds, Giphy, Masquerade, Waze, Picasa, benefits, authorities, power, monopoly, competition

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Abstract

In recent years, antitrust authorities have identified "killer" acquisitions as a particular problem for the tech industry. A "killer" acquisition is often described as the acquisition of a small, innovative startup by a large, well-established company. Typically, a startup has limited or no revenue (so it may be below the relevant merger threshold) and may never be profitable, but at a potentially large price. This definition is sometimes extended to indicate that the acquisition was made in anticipation of competition between the start-up and the incumbent.

Definitions
Scope of the problem
Illustrations with some acquisitions
Antitrust issues raised
My assessments of the problem

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[...] The treatment of killing acquisitions by GAFAM: Antitrust implications Sommaire I. Definitions 2 II. Scope of the problem 3 III. Illustrations with some acquisitions 4 IV. Antitrust issues raised 4 V. My assessments of the problem 6 Conclusion 6 Bibliographie 7 Definitions ::GAFAM: GAFAM is an acronym for five popular American technology stocks: Google (Alphabet), Apple, Facebook (Meta), Amazon and Microsoft. GAFAM is very similar to, but different from, the more popular acronym FAANG, which collectively stands for American technology stocks: Facebook, Apple, Amazon, Netflix, and Google. [...]

[...] Interestingly, not a single GAFAM acquisition has been blocked in the past. Moreover, the competition authorities simply did not examine most of these transactions against the current turnover thresholds. For example, a US Federal Trade Commission (FTC) report shows that GAFAMs made 616 unreported acquisitions of million or more between 2010 and 2019, excluding new hires or acquisition patents. This has led to a few policy reports asking whether "big tech companies" seek out potentially anti-competitive acquisitions of nascent or potential competitors that are not vetted at all, or at least not vetted enough. [...]

[...] In this sense, on December the European Commission proposed a draft regulation on the Digital Markets Act, which aims to raise awareness among anti-government companies of any plans to merge with another supplier by requiring these companies to notify at the Monopoly Board laws apply to digital businesses. I also think that the high-speed train threshold needs to be revised. Certainly, research on acquisitions that kill shows that small acquisitions should no longer be ignored but should be taken seriously from the start. The US court case was a good start for me and should end with the dissolution of Meta. This would certainly restore the independence of Instagram and WhatsApp, but above all would send a strong and symbolic message to the other GAFAM companies. [...]

[...] GAFAM : comment limiter les « acquisitions tueuses » de start-up ? La Tribune. https://www.latribune.fr/opinions/tribunes/ [HYPERLINK: https://www.latribune.fr/opinions/tribunes/gafam-comment-limiter-les-acquisitions-tueuses-de-start-up-902774.html]gafam-comment-limiter-les-acquisitions-tueuses-de-start [HYPERLINK: https://www.latribune.fr/opinions/tribunes/gafam-comment-limiter-les-acquisitions-tueuses-de-start-up-902774.html]up-902774.html [HYPERLINK: https://www.latribune.fr/opinions/tribunes/gafam-comment-limiter-les-acquisitions-tueuses-de-start-up-902774.html] R. Preston McAfee Et Hugo M. Mialon. (2004). Barrières à l'Entrée dans l'Analyse Antitrust. ? ? https://vita.mcafee.cc/PDF/B2EFrench.pdf Tazrout Z., Tazrout Z., Tazrout Z., Tazrout Z., Tazrout, Z., Gerlat P., Benoit M., Maubant T., & Calvi T. ( mai). GAFAM : retour sur leurs stratégies et acquisitions en matière d'intelligence artificielle en 2020. Actu IA. https:// [HYPERLINK: https://www.actuia.com/actualite/gafam-retour-sur-leurs-strategies-et-acquisitions-en-matiere-dintelligence-artificielle-en-2020/]www.actuia.com/actualite/gafam-retour-sur-leurs-strategies-et [HYPERLINK: https://www.actuia.com/actualite/gafam-retour-sur-leurs-strategies-et-acquisitions-en-matiere-dintelligence-artificielle-en-2020/]acquisitions-en-matiere-dintelligence-artificielle-en-2020/ [HYPERLINK: https://www.actuia.com/actualite/gafam-retour-sur-leurs-strategies-et-acquisitions-en-matiere-dintelligence-artificielle-en-2020/] [HYPERLINK: https://www.actuia.com/actualite/gafam-retour-sur-leurs-strategies-et-acquisitions-en-matiere-dintelligence-artificielle-en-2020/] Vitard, A. [...]

[...] ( septembre). Les stratégies d'acquisition des Gafam disséquées par l'autorité américaine de la . usine-digitale.fr. [...]

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