Professor Susan Watson of the University of Auckland argues that contemporary Big Tech firms like Amazon, Meta, and Google operate less like traditional market competitors and more like entities controlling essential digital infrastructure. Her paper asserts that conventional competition law fails to address this structural concentration of corporate power.
The Bottom Line
- Structural Overhaul: Traditional competition laws focused on particular business practices and market behaviour fall short when dealing with corporations that essentially own digital territory and infrastructure.
- Historical Parallels: Academic analysis compares today’s tech giants to the English East India Company and the corporations of the Gilded Age.
- Proposed Remedies: Suggested interventions include banning surveillance-based business models, licensing major digital platforms, and restricting data ownership claims.
Decoding the Corporate Architecture of Digital Monopolies
When evaluating the market dominance of modern technology conglomerates, standard financial metrics often obscure the fundamental nature of their power. According to Professor Susan Watson in her paper Reining in Big Tech Corporations: Why Platform Governance Requires Structural Regulation, businesses such as Amazon, Meta, and Google have moved past standard market participation. Instead, they control the digital platforms and infrastructure upon which people and businesses depend.
Here is the core legal reality: corporations are not merely private business entities operating in a vacuum. They are legal entities created and empowered by States through incorporation. This legal framework grants artificial legal persons the enduring ability to hold property, execute contracts, write internal rules, and lock in capital. By ignoring this state-granted authority, regulators have historically miscalculated how rapidly digital infrastructure can translate into control.
Drawing Parallels from the East India Company to the Gilded Age
History provides explicit frameworks for understanding how concentrated private enterprise can accumulate power. During the height of mercantilism, the English East India Company accumulated powers normally associated with governments, including territorial lawmaking and tax collection. Similarly, by 1890, American corporations controlled critical physical networks like railways and oil, commanding three-quarters of the nation’s wealth.
That accumulation of power was ultimately disrupted by the state through the 1890 Sherman Act. Today’s tech giants represent a new version of this concentration of corporate power, executed across virtual territory rather than physical rail lines. Conventional competition law usually targets isolated business practices or market behaviour. Watson argues that conventional frameworks are fundamentally unequipped to regulate entities that simultaneously act as market operators, rule-makers, and infrastructure gatekeepers.
| Era / Entity | Controlled Infrastructure | Regulatory Response |
|---|---|---|
| English East India Company | Trade routes and territories | Not specified |
| Gilded Age Corporations (1890s) | Railways, oil, and heavy industry | Sherman Act / Structural breakup |
| Modern Big Tech (Amazon, Meta, Google) | Digital infrastructure, search, and social platforms | Proposed platform licensing and surveillance bans |
Potential Structural Remedies and Market Implications
Addressing this level of consolidation requires shifting away from behavioral focus toward structural regulation. The research proposes several possible approaches. Among them are explicit bans on surveillance-based business models, limitations on corporate data claims, and mandatory licensing requirements for core digital platforms.
Another possibility involves giving people affected by these companies a greater say in how they are governed, drawing inspiration from alternative legal personhood frameworks like New Zealand’s Whanganui River.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
