As the Innovators Network Foundation (INF) enters the third year of its Antitrust and Competition Fellowship Program, we’re taking a moment to reflect on the impactful work our fellows have contributed over the past year. There were several significant developments in antitrust law in 2024, including lawsuits challenging the curated online marketplace (COM) business model, skeptical merger policy, and preemptive investigation of AI services markets. As a new Administration prepares to reshape tech policy, our fellows remain at the forefront of the ongoing debate over antitrust enforcement and its applicability in the digital ecosystem.
“Ex-ante” is Still Not the Way
Ex-ante regulation in the digital ecosystem risks stifling innovation, deterring investment, and entrenching incumbent firms by imposing rigid, “one-sized-fits-all” policies before market issues even arise. This preemptive regulatory approach has proliferated globally in recent years. As the European Union’s Digital Markets Act (DMA) took into effect in 2023, countries like South Korea, Australia, Brazil, and many more have begun considering ex-ante frameworks for their countries’ antitrust laws. To explore the lessons learned from ex-ante regulations like the DMA, INF held a webinar titled “Will Europe Eat the World?” on July 26th. A full recap of the event is here. The panelists discussed how the EU’s efforts sought to strengthen its digital economy but, unfortunately, have only served to stifle innovation among small and medium-sized businesses (SMBs) both in Europe and here in the United States. The event showcased that to foster a truly dynamic and equitable digital ecosystem, and policymakers must strike a balance that preserves the benefits SMBs gain from COMs and the integrated and complementary services they provide. By adopting an ex-ante regulatory framework, the DMA seeks to eliminate consumers’ ability to choose actively managed COMs over unmanaged marketplaces, with significant implications for consumers worldwide. As Jane Bambauer highlighted, the DMA’s restrictions narrowly focus on competition within COMs, completely missing the fact that there is competition between COM business models:
“The DMA’s provisions deny end-users the ability to express preferences… these preferences in what consumers want are essential to competition. The competition is between business models.”
The resulting regulatory structure limits consumer choices between COM business models, supplanting consumers as the arbiters of winning COM approaches with regulator preferences. Jane further encouraged the audience to recognize the costs of eliminating this axis of competition and redirecting it to a system that protects competitors rather than consumers, which she argued could inadvertently create more barriers for EU developers. (Stay tuned for Jane’s next piece expected in early March talking about the role of curation in online marketplaces as they compete on the merits of consumer choices.)
Agencies Continue to Leave Small Businesses in the Dust
In its aggressive push for heightened antitrust enforcement, the Federal Trade Commission (FTC) and Department of Justice (DOJ) have continued to overlook the concerns of small business innovators in their pursuit of so-called “Big Tech.” By prioritizing speculative theories of harm and broad interventions against larger firms, policymakers are failing to account for how these stringent approaches to mergers, market dynamics, and digital services disproportionately burden startups and small businesses—many of which lack the resources to navigate complex regulatory shifts. These unintended consequences were explored in our inaugural publication by Jessica Melugin, titled, “Crushing David on the Way to Fight Goliath: How the Federal Trade Commission’s (FTC) War on Bigness Will Also Hurt Small Business.” In her report, Jessica details how preemptive enforcement actions ultimately stifle innovation and create barriers for emerging firms striving to compete in the digital ecosystem. Jessica specifically points to the FTC’s overzealous lawsuit against Amazon, labeling it “a solution in search of a problem.” She goes on to write:
“[On Amazon] both consumers and the small and medium-sized businesses (SMBs) that sell on the platform seem pleased with their partnership with Amazon… the incentives align between Amazon and its SMBs. The growth of these smaller businesses, aided in their success by Amazon, also drives second-order benefits by creating more jobs and prosperity as those small businesses grow faster than they otherwise would have without the reach, scope, and services of Amazon.”
INF fellows’ coverage of this topic continued into the spring when Jessica and our Competition Fellowship manager, Jong Hun Chung, talked more about FTC enforcement and “Big Tech” cases at the Informa West Coast conference. Jessica discussed how these cases often fail to understand the value COMs offer to small businesses. In the case of Amazon, the FTC sought to “unbundle” the logistics services. Jessica highlights the agency’s failure to recognize that fulfillment by Amazon (FBA) is often a more cost-effective alternative than the fulfillment services small businesses can shop for separately and on an unbundled basis.
One of our other fellows, Ted Bolema, also outlines the economic failures of this case in his op-ed titled, “Michigan’s Lawsuit Against Amazon Fails Econ 101.” In this piece, Ted delves into the substantial effects of Amazon’s business model, highlighting how it has ignited competition and broadened consumer choices through significantly lower prices. Importantly, he sheds light on Amazon’s Marketplace, a fast-track option for countless SMBs to reach customers around the world. He writes:
“The smaller sellers on Amazon benefit greatly from access to Amazon’s massive customer base, reputation, easy entry into a vast geographic market and fulfillment services. Larger merchants may not benefit as much from these services but would definitely gain from being able to list their products on the platform for free.”
While the FTC is likely to continue this case in 2026, our fellows warn of its potential consequences if the suit is successful—not just for small businesses but also for consumer choice.
What is the Roadmap Ahead?
The future of antitrust enforcement stands at a critical crossroads. With a new Administration and a majority party in both chambers, policymakers are considering the application of antitrust rules to rein in technology markets and COMs. Our fellows have continued to be at the forefront of shaping this evolving landscape of what antitrust enforcement should look like. As regulators, enforcers, and lawmakers continue to explore some of the global and domestic shifts in digital competition policy, we must consider the risks of overreach and unintended harm to small businesses.
To bring this shifting landscape into focus through an American competitiveness lens, INF held its first in-person event in the U.S. Capitol Building, co-hosted with the George Washington Competition & Innovation Lab. The event began with opening remarks by competition fellow Christine Wilson, a former FTC commissioner and head of antitrust, competition, and trade at Freshfields. Christine drew a stark contrast between the European Union’s regulatory approach to technology—rooted in the precautionary principle of regulating potential harm before it materializes—and the traditional emphasis in the United States on “permissionless” innovation. She warned of the growing push for ex-ante regulatory models, such as the EU’s Digital Markets Act (DMA), and their potential consequences for the U.S. economy. Christine framed the debate as a critical choice: adopt a preemptive regulatory regime that prioritizes competitor grievances or maintain an innovation-driven framework rooted in the consumer welfare standard and market-driven competition.
She cautioned against using antitrust as a “one-size-fits-all hammer” for market concerns, arguing that ex-ante regulation often suppresses innovation and economic growth. Highlighting the stagnation of Europe’s tech sector under heavy-handed policies like the General Data Protection Regulation (GDPR) and DMA, she underscored the risks of prioritizing regulation over dynamism. Christine also stressed the importance of due process in antitrust enforcement, advocating for the continued allowance of procompetitive mergers and COM management functions and services that benefit small businesses and consumers. She concluded with a strong call to action for Congress and the Administration to uphold the consumer welfare standard, warning that undermining America’s digital economy could undermine competitive advantages to global rivals like China.
The panel featured another INF competition fellow, Elyse Dorsey, who examined key legislative proposals such as the Open App Markets Act (OAMA) and the American Innovation and Choice Online Act (AICOA). She noted that while these bills share similar objectives with the EU’s DMA, they have seen limited progress in Congress—and for good reason. Elyse expressed concerns about their potential impact on innovation and investment, cautioning that broad regulatory measures could stifle competition rather than enhance it. The discussion also covered ongoing antitrust cases, including DOJ v. Google and FTC v. Amazon, exploring their potential to set critical precedents for future enforcement. “These cases will shape the application of antitrust laws in the tech sector,” Elyse remarked, emphasizing their far-reaching implications for digital markets.
Looking ahead, the Trump-Vance Administration may look to scale back some of the Biden-Harris Administration’s prioritization of government intervention over competition in digital markets, and INF fellows helped highlight some of the problems with them. Seeking to create new sources of antitrust liability, the FTC and DOJ sought to cast broader categories of mergers under threat, casting a long shadow of uncertainty over the enterprise value, growth, and exit prospects of small business innovators. Adopting this fundamentally anti-merger policy inevitably shrank potential returns on equity investments, created barriers to funding for startups, lowered company valuations, and drove up borrowing costs—all of which make it harder for new businesses to grow and even tougher for fresh ideas to break into the market. The other high-level area where INF fellows helped define an opportunity for the Trump-Vance Administration to improve antitrust policy is in allowing small businesses to continue to benefit from COM management functions. Small business innovators leverage COM services far more than their larger competitors, and restrictive regulations or antitrust liability and remedies could end up hurting the very businesses they claim to protect. As Congress and the new Administration shape the future of U.S. antitrust policy, INF remains a key resource for policymakers to understand how government intervention to address complaints from large, well-resourced competitors would affect consumers, competition, and small businesses in particular.
