Green paper on online platforms

Who could possibly explain the importance of the digital revolution better than men in their fifties. This is at least what the Federal Ministry for Economic Affairs and Energy must have thought when they presented their green paper on the regulatory framework for online platforms.

The presentation of the green paper marks the start of a consultation process ending on 30 September 2016. Companies are being called upon to actively engage and contribute. Eearly2017, the Ministry will present a white paper with concrete regulatory proposals. Most experts agreed: The green paper asks the right questions – but ten years too late. Based on twelve theses and 52 specific questions, the Ministry intends to develop approaches on how to deal with digital corporations. Topics include “targeted pricing”, “data sovereignty”, “special requirements for search engines” and “transparency”.

The devil is in the details. One thesis is that search engines, whether they are market dominant or not, must be subjected to particular obligations. However, questions remain unanswered. What is defined as search engine? Every tool that is used for a search? One topic, which was also intensively discussed, was “targeted pricing”. Targeted pricing is not a new phenomenon in the online world. For example, it is common practice for motor insurer to offer different rates depending on the type of the car and the experience of the driver. For an economist, individual prices are not bad per se. Individuals are only paying what they are willing to pay. It becomes dangerous when systems based on solidarity will be destroyed. While the Federal Government is waiting for Stakeholder responses, it do not remain passive. It plans to introduce the ninth Amendment to the Act Against Restraints of Competition before the parliamentary summer break. The Federal Government reckons that a company’s value must not only be assessed by its revenue but by its access to data. However it remains difficult to quantify data’s value
Over two years after the Federal Government presented its Digital Agenda and only 15 month left before the next federal election, the Federal Government sets itself an ambitious goal. On the other hand, the topic will remain with us throughout the next election campaign. Now is the time to act and shape the Germany’s digital future.

For more information see Green Paper (external link | German)

Author

Stefanie Grunert

Senior Consultant

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