ERDEM-NEWSLETTER-2018-metin

82 NEWSLETTER 2018 platform can be assessed based on more than just one customer group, which would mean that the market definition assessment might result in multiple relevant markets. Consequently, in order to define the rel- evant market for online platforms, it must be established how many markets are required to be defined. Generally, the choice comes down to defining a single relevant market for the platform itself, or separate relevant markets with regard to the customer groups participating on the platform. The choice between these possibilities has significant consequences in terms of the scope of the relevant market. In the case of Amazon, given that it acts both as a marketplace and a direct online retailer, the market definition will be more difficult than it appears at first glance. Once the market is defined, assessing the market power of the online platform is the next step. In relation to the assessment of mar- ket power, online platforms present some specific differences when compared to traditional markets that need to be taken into account. Firstly, possession of vast amounts of data by online platforms is a fac- tor that might indicate market power, as pointed out for the first time in the Commission’s Facebook/WhatsApp decision 4 . On that front, the more detailed data that online platforms have, the more knowledge they will acquire about customers, thus enabling them to provide bet- ter services at a lower price, which in turn will increase their market power over time. Secondly, online platforms are usually the first mov- ers 5 due to significant winner-takes-all effects 6 , and this confers a certain degree of market power on them. Finally, market shares are a less reliable proxy of market power as compared to traditional mar- kets, as market shares in these markets tend to shift greatly over a limited period. This is because the possibility of disruptive competi- tion is possible and probable in the digital market space, and a very 4 Case COMP/M.7217 - Facebook/Whatsapp. 5 A market participant has first-mover advantage if it is the first entrant and gains a competitive advantage through control of resources (Grant, Robert M. (2003), Cases in Contemporary strategy analysis). 6 A winner-take-all market is a market in which a product or service that is only slightly (1%) better than the competitors gets a disproportionately larger (90%- 100%) share of or all revenues for that class of products or services. (Grant, Ran- dy R.; Leadley, John C.; Zygmont, Zenon X. (2014). The Economics of Intercol- legiate Sports).