Part IV Special Issues in Technology Markets, 7 Antitrust Issues Surrounding Open and Closed Systems

Subject(s):

European Union — Copyright — Licensing — Rights — Technology transfer agreements — United States

This chapter examines the tension between open and closed systems. Open networks allow technology creators and users to operate freely, building on what others have done without permission. In contrast, closed platforms operate under owners’ rules. By reducing free-riding, proprietary interests encourage owners to coordinate network usage and optimally to invest in their improvement. Thus, open and closed platforms can both foster innovation, but each can also depress it. The chapter explores when antitrust requires a patent owner to license its competitors to facilitate competition. That question requires the analysis of competitive effects where the challenged restraint implicates offsetting considerations in the present and future. This phenomenon is especially acute at the antitrust–patent intersection.