This is a platform-killing limitation, if it were workable at all. There’s no way to survive if you have to have prices you guessed at years ago, and newer competitors can pick theirs based on more recent data (including reaction to your committed prices).
Fortunately, it’s not actually workable. Who is supposed to enforce this, and how will they determine which technological platforms are subject to this, and what changes in the platform justify different pricing? This implementation is more complex and difficult than the current SEC, FTC, and court system of identifying and limiting monopolistic practices.
I’m pretty convinced that interventions around pricing or post-monopoly behaviors are the wrong way to think about the problem. Look for ways to remove barriers to competition, not for ways to reduce the profit from non-competition (mostly; it’s possible that a mix of approaches is better than any single one). To the extent that you have groups or agencies who can enforce anything in the first place, they should be enforcing data portability and transparency, in order for platform competition to flourish as customers change their preferences.
Oh, one more difficulty in price-setting enforcement: many MANY platforms don’t have a single visible price. Ad sales are a very complicated contract + auction environment. Commissions have less-complicated but still variable pricing based on categories and contracts that change over time for key partners.
Though I don’t especially disbelieve it, it would be helpful if you could tell some stories about how and why various platforms would been likely to be killed by (a decent implementation of!) pricing precommitment?
This is a platform-killing limitation, if it were workable at all. There’s no way to survive if you have to have prices you guessed at years ago, and newer competitors can pick theirs based on more recent data (including reaction to your committed prices).
Fortunately, it’s not actually workable. Who is supposed to enforce this, and how will they determine which technological platforms are subject to this, and what changes in the platform justify different pricing? This implementation is more complex and difficult than the current SEC, FTC, and court system of identifying and limiting monopolistic practices.
I’m pretty convinced that interventions around pricing or post-monopoly behaviors are the wrong way to think about the problem. Look for ways to remove barriers to competition, not for ways to reduce the profit from non-competition (mostly; it’s possible that a mix of approaches is better than any single one). To the extent that you have groups or agencies who can enforce anything in the first place, they should be enforcing data portability and transparency, in order for platform competition to flourish as customers change their preferences.
Oh, one more difficulty in price-setting enforcement: many MANY platforms don’t have a single visible price. Ad sales are a very complicated contract + auction environment. Commissions have less-complicated but still variable pricing based on categories and contracts that change over time for key partners.
Though I don’t especially disbelieve it, it would be helpful if you could tell some stories about how and why various platforms would been likely to be killed by (a decent implementation of!) pricing precommitment?