Exploring ways in which the business activities of internet companies can be regulated.
Digital platforms offer a great deal of services that are attractive to customers. For instance, they make it easy to find products, to access product information, and to compare prices and suppliers. On top of that they generate economic benefit by creating new jobs, new technologies and new methods of production. However, the business models of digital platforms also trigger changes in economic structures. These changes go beyond the sphere of economy; they also concern politics and society. For instance, companies such as Amazon, Alphabeth, and Netflix strive to dominate their market and achieve as much pricing power as possible. This leads to monopolies of information, to high market concentration, and as a consequence to a dependence on a low number of suppliers.
In the current project the term “open data” has a wider meaning than usual and involves databases, software and other content, as clear dividing lines are difficult to draw. The question under consideration is in which ways and to what extent the use of open data needs to be regulated. Internet companies often provide their data and applications free of charge, but on the other hand, they use private data of their costumers for value creation. Not only is personal data commercialized, but the access to previously freely available data is restricted, thereby reducing diversity of information. It has been shown that business models building on open data frequently lead to market concentration – an outcome that is in stark contrast with the idea of open data. In addition, because some platforms (e.g., Google, Facebook) produce or distribute media content, the boundaries between media and technology companies are blurred. All this not only poses challenges for economic policies but also touches on ethical questions. Consequently, there is a need to research the ways in which media law, media policies, and media ethics are affected by the business models of internet platforms. This lays the foundation for well-considered measures for regulating the business activities of such platforms.
The business models of digital platforms are scrutinized. It needs to be clarified to what extent regulations are required in order to minimize a negative impact on the availability of information and the knowledge commons. Special attention is given to the conflict area that arises between private data and open data. Important research questions are: Which liberties should be granted to digital companies, which obligations should be imposed upon them and what kind of interventions are needed on the part of the authorities. The main aim is to develop a governance model that supports decision makers in economy and politics when regulating open data business models in general, and the activities of digital platforms in particular.
The project consists of several parts that build on each other. In the first part knowledge on open data, digital platforms and different methods for regulating the activities of the platforms is accumulated. Based on this an initial framework for a governance model is devised. In the second part expert interviews with managers of digital platforms and media companies as well as different actors who use open data in their business model are conducted. It is the aim of these interviews to discuss different scenarios for open data business models and to think about useful measures to keep negative consequences such as market concentration and restrictions on diversity of information under control. The expert interviews also provide the contents for experimental research. In this experiment reactions and attitudes of mid-level and high-level managers towards different regulations concerning digital platforms and open data business models are analysed. To check validity, our findings are discussed in the final part of the project by a focus group.
The insights gained during the project will support politicians and other regulatory bodies in making informed decisions on which measures are useful to regulate the activities of digital platforms and to judge what consequences certain measures can have. Digital platform companies also benefit from the project content, as they have access to knowledge that helps them to take steps for self- or coregulation to prevent possible legal actions initiated by the government. In summary, combining media economics with media ethics opens up new points of view for the governance of open data and private data.