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How to deal with Big Tech mergers

By  |  February 26, 2020

Massimo Motta, Martin Peitz; Vox EU

Big Tech companies frequently acquire other firms, many of them start-ups.  In a recent prominent report, Furman et al. (2019) observe that “[o]ver the last 10 years the 5 largest firms have made over 400 acquisitions globally. None has been blocked and very few have had conditions attached to approval, in the UK or elsewhere, or even been scrutinised by competition authorities.” Many of these mergers have made it possible for the acquirer to embed new functionalities in their offerings, boost the popularity of the acquired firm’s offering, or integrate the acquired firm’s staff-generating synergies. However, some mergers have arguably removed actual or potential competitors and, as a result, reduced consumer welfare…

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