With apologies to Nicolas Petit at Chillin’ Competition for stealing a blog topic, Slate’s imaginary war between Google and Apple makes for interesting antitrust reading and might prove to be handy fodder for anyone looking for scenarios for an antitrust exam.
Professor Petit points out a few of the interesting competition/antitrust issues involved, but I wanted to highlight another. As he notes, the imaginary “Operation Ghostfruit” that Slate assigns to imaginary Google is an extreme version of the search bias concerns that the European Commission is still trying to find a way to address. But search bias is old news.
The first tactic that really interested me from an antitrust perspective was when Google reached beyond its own systems and sought help from the outside. As the imaginary tactics escalated, Slate’s Farhad Manjoo has his imaginary Larry Page ring up the CEO of Samsung to make an offer that Dr. Kwon Oh-Hyun can’t refuse. Samsung, you see, makes the processors that run all of Apple’s mobile devices. But Samsung also makes its own mobile devices, powered by Google’s Android operating system. The imaginary tactic should be obvious. Imaginary Page tells imaginary Dr. Kwon that Samsung will be cut off from Android if it continues to sell processors to imaginary Apple. Not wanting to lose its entire mobile device business, Samsung agrees.
Has imaginary Page and imaginary Google got an antitrust issue from this stroke of evil genius (the evilness being an ironclad indication that the scenario is imaginary)?
Well, let’s see. Google does not compete with Samsung in the manufacture of processors (or, if Motorola Mobility does make processors, let’s just ignore that to make this more fun) and, as far as I know, Samsung does not compete with Google in mobile operating systems. Which would make this not an agreement among horizontal competitors. Moreover both parties may be able to claim that they are protected by the Colgate doctrine to choose with whom they will deal.
But on the other hand, there is an agreement here, and there may be a non-trivial effect on competition. Maybe there’s an agreement in restraint of trade anyway? Maybe imaginary Google is monopolizing by forcing Samsung to cut off Apple? Maybe there is an unfair method of competition in there somewhere?
Perhaps Professor Petit can ask his students.
(Do you think I said “imaginary” enough for it to be completely clear that everything in this post, and the Slate article, is entirely made up?)