On November 4, 2021, the German Federal Cartel Office (“FCO”) published an interim report on its sector inquiry into messenger and video services,[1] exploring the necessity of interoperability rules for messaging services. The interim report does not contain recommendations but reserved them for the final report expected to be released in 2022.
The FCO considers that the economic analysis of possible interoperability rules is very complex due to the large number of operators employing different business models (advertisement-based, freemium, paid subscriptions, open-source). While interoperability may reduce lock-in effects, it would require standardization which may reduce innovation and competition through product differentiation. Further, it is “at best questionable” whether interoperability would entice users to switch to more privacy-friendly services, in particular because approx. 65% of users already use more than one service.
The FCO’s findings were supported by the results of a survey among messenger and video services providers. The majority of the 44 respondents expected an interoperability obligation to decrease innovation, data security, and data protection as well as user experience. All respondents expected that an interoperability obligation would not increase their revenues, but either not affect or decrease them.
The sector inquiry shows the FCO’s continued interest in the digital sector. It is the fifth sector inquiry concerning consumer protection in digital markets following inquiries into price comparison websites[2], user reviews[3], smart TVs[4] and mobile apps[5].
Editor: Katharina Apel
[1] See the FCO’s Press Release of November 4, 2021, available here. The full interim report is only available in German here.
[2] For further information, please see our article on our Cleary Antitrust Watch blog here.
[3] For further information, please see our article on our Cleary Antitrust Watch blog here.
[4] For further information, please see our article on our Cleary Antitrust Watch blog here.
[5] For further information, please see our article on our Cleary Antitrust Watch blog titled “The FCO’s Interim Report On Mobile Apps”.