8 ms·

Khan is massively pro-startup and pro-innovation. Her vision of a more decentralized economy is well aligned with the hacker mindset of the Bay Area. The core

Khan is massively pro-startup and pro-innovation. Her vision of a more decentralized economy is well aligned with the hacker mindset of the Bay Area. The core of her agenda for antitrust is not about being anti-merger or anti-bigness. Rather, her project is mainly about creating the conditions for pluralistic, bottom-up and more "permissionless" markets. Markets where founders can build successful businesses without necessarily having to rely on large 'gatekeeper' firms as partners. To the extent that large firms are required, Khan's vision is that they shouldn't be able to use their economic power to bargain unfairly or exploitatively with smaller firms. Part of her agenda is strengthening the merger review process. Merger review is intrinsically hard, because authorities essentially have to try and figure out what the effect will be if the merger is allowed or denied. There is no crystal ball for this, and there are rarely 'right' answers. Yet the merger regime has been very favourable to large firms over the past few decades, and there's a reasonable consensus in the antitrust community that it should be strengthened. A tighter merger process might make startup exits through acquisition less common, but it should also make it easier for startups to grow organically into large companies. In terms of creating a bottom-up and more pluralistic Silicon Valley, that seems like a win to me. (Source: I'm doing a PhD in Antitrust/Competition Law)

wskinner 3y ago
> Part of her agenda is strengthening the merger review process. Merger review is intrinsically hard, because authorities essentially have to try and figure out what the effect will be if the merger is allowed or denied. There is no crystal ball for this, and there are rarely 'right' answers. Yet the merger regime has been very favourable to large firms over the past few decades, and there's a reasonable consensus in the antitrust community that it should be strengthened. A tighter merger process might make startup exits through acquisition less common, but it should also make it easier for startups to grow organically into large companies. In terms of creating a bottom-up and more pluralistic Silicon Valley, that seems like a win to me. Serious question: what is the "antitrust community"? Can you shed some light on the theory that making mergers more difficult would either a) make it easier for startups to grow organically or b) benefit society in general? If the upside from working at or creating a startup is due to some combination of IPO or acquisition (this is of course a simplified model), and acquisitions are made more difficult, why do you assume that IPOs would become more likely or more lucrative? Once upside is removed from the startup ecosystem, how will potential employees and founders respond at the margin? I'm struggling to see an equilibrium here that involves more rather than less money and work poured into startups.
- catlover76 3y ago
  > Serious question: what is the "antitrust community"? Not the poster, but I would assume it refers to the people who follow developments in antitrust law and the enforcement thereof (so antitrust lawyers, basically).
  - dmoy 3y ago
    > so antitrust lawyers, basically). Well, and lawyers-turned-professor and/or treatise authors (who are typically professors). Often the experts turn towards academia if they're truly in it just to know everything about the field. So, Hovencamp, etc. "Legal scholar" if you will
- todd-davies 3y ago
  The "antitrust community" is people working in antitrust law/policy/academia who write, tweet, speak at conferences, etc. Two caveats are that a) this is my view based on personal observations, and b) that a consensus doesn't mean that everybody agrees. Undisputedly however, there is a lot of academic work these days which comes to the conclusion that merger review should be strengthened. For instance, see [1]. Khan's aim isn't necessarily to make mergers more difficult, or to prevent them per se. Rather, it's to make a more concerted effort to prevent mergers which on balance, appear not to be in the public interest. There are several reasons why a merger might be harmful. First, some mergers are "killer acquisitions" whereby a large firm will acquire a "nascent" competitor and then discontinue its product (e.g. [2]). One danger here is that killer acquisitions nip start-up competition in the bud, such that new firms don't have a chance to grow and compete against incumbent firms. That's a problem because competition means that consumers, rather than incumbent firms, ultimately get to choose market outcomes. If there is no choice, then consumers can't choose. The ultimate failure mode here is some kind of command economy where monopoly firms get to make most of the decisions about how markets work and consumers get little say at all. Second, mergers lead to market concentration because you're taking a market with n firms and moving to a market with n-1 firms. Market concentration isn't inherently bad, indeed, some markets are 'naturally' concentrated. That said unconcentrated markets are generally preferred to concentrated ones because concentrated markets can lead to things like tacit collusion (which has similar outcomes to a cartel) [3]. Third, if there is a real possibility for startups to grow organically and challenge large incumbent firms for the market, then theory goes that VC funding could be stimulated on the promise of a potentially huge return. For instance, a VC might be willing to fund a firm if there's a 5% chance that it will be the next Google, but not if there's a 10% chance that it gets acquired in a year or two. You make a good point regarding acquisitions, IPOs and the personal incentives to work at a startup. I'm not assuming that IPO's would become more likely or lucrative; I don't have a view on that (except perhaps what I said in the previous paragraph). I guess if a firm was going to be successful, and a merger wasn't an option then it would eventually IPO instead, no? That might lead to delayed compensation, but it shouldn't affect the viability of a solid business. Fewer acquisitions might end up with some firms failing before IPO which would have otherwise been acquired. That's bad from the perspective of those at the firm, but isn't inherently bad from a social perspective. After all competition necessarily entails winners and losers. If all else fails, there is a 'failing firm defence' which would allow an acquisition if the only other option is the firm going out of business [4]. Finally, the lack of enforcement over the past few decades hasn't given regulators much opportunity to "learn" what is a good/bad merger. A more active merger review policy would entail regulators building up expertise and fine-tuning their approach. It's important to remember that merger control isn't necessarily adversarial. At its best, it's a positive-sum dialogue between firms who want to do business and regulators who are trying to provide public-minded oversight. [1] Kwoka, John. "The structural presumption and the safe harbor in merger review: False positives or unwarranted concerns." Antitrust LJ 81 (2016): 837. https://heinonline.org/HOL/Page?handle=hein.journals/antil81&div=36&g_sent=1&casa_token=92W9pnae2VUAAAAA:O9RRAyIhFsl9dpI-EScM1GrazYaiZnbOnQZZkYqEUSS6or0gBuWP_fClP_yBOnR5HwZdCW9u&collection=journals https://heinonline.org/HOL/Page?handle=hein.journals/antil81... [2] https://news.ycombinator.com/item?id=38145568 https://news.ycombinator.com/item?id=38145568 [3] https://www.tutor2u.net/economics/reference/oligopoly-tacit-collusion https://www.tutor2u.net/economics/reference/oligopoly-tacit-... [4] https://www.concurrences.com/en/dictionary/Failing-firm-defence https://www.concurrences.com/en/dictionary/Failing-firm-defe...
IG_Semmelweiss 3y ago
Lina Khan's vision is one of contempt of the law and disregard of due process. A society where rules are made up on the fly based on whats popular and where the political wind blows [1] Lina Khan's direct actions of regulation-by-the-hip , and continued losses in the courtroom, will weaken actual anticompetitive powers, and ultimately favor monopoly generation by big entrenched players [1] I dont want the govt to make up rules on the fly. Even if its going after monopolistic companies. Because I know its only a matter of time until the govt uses the same pretext to come after me, too. [1] https://archive.vn/aXD6T https://archive.vn/aXD6T
- janalsncm 3y ago
  > A society where rules are made up on the fly based on whats popular and where the political wind blows Sorry, where do you think laws come from? They’re not written on stone tablets at the top of a mountain. They’re written by people for people. If you prefer Robert Bork’s hands off approach to markets that’s your prerogative but we can’t separate laws and regulations from their consequences. There’s no question in my mind that Amazon’s market share allows them to push their weight around in ways that raise prices for consumers as well as stifle competition and make workers’ lives worse.
  - IG_Semmelweiss 3y ago
    [flagged]
  - wskinner 3y ago
    In the United States, laws come from Congress.
    - astrange 3y ago
      SCOTUS is unfortunately more powerful than Congress, at least because they're more capable of doing things. Luckily they're more aligned with consumer welfare, which is good, as opposed to Khan's hippie "everything big must be bad" standard. This only supports small business owners and VCs, who are probably the most evil people in the US.
sashank_1509 3y ago
She made her career or reinventing the definition of monopoly to include Amazon and big tech companies to date. At worst she’s a cynical, corrupt government apparatchik who uses the massive hammer of the government to bully productive industries and enrich herself with fame and money. At best she is an ignorant, foolish government apparatchik who squeezes the goose laying golden eggs to death and then wonders how she managed to make the worlds most innovative place completely barren of innovation, vitality thus dooming her society. She almost makes me want to vote republican, and that’s saying something as I’ve never voted republican my entire life.
- andsoitis 3y ago
  > She made her career or reinventing the definition of monopoly to include Amazon and big tech companies to date. Is this what you're referring to? https://www.npr.org/2021/07/01/1011907383/new-ftc-chair-lina-khan-wants-to-redefine-monopoly-power-for-the-age-of-big-tech https://www.npr.org/2021/07/01/1011907383/new-ftc-chair-lina...
- Conscat 3y ago
  If she did actually redefine monopoly in that way, without more detail it at least sounds like a useful redefinition.
- patmorgan23 3y ago
  No she made her career by stating the obvious that maybe it wasn't a good idea for the FTC to forgo anti-trust enforcement for 40 years. Oh no the trillion dollar tech giants have to undergo some scrutiny, how ever will they continue to pay their executives and shareholders millions.
  - dang 3y ago
    Please don't respond to a bad comment by breaking the site guidelines yourself. That only makes things worse. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- catlover76 3y ago
IG_Semmelweiss 3y ago
Killing random mergers for no reason, is killing the only exit left for many companies (the IPO door is closed now). That is massively anti-startup in my book.
- mcpackieh 3y ago
  Maybe companies should try being profitable instead of being acquisition bait.
  - IG_Semmelweiss 3y ago
    Thats a strange take. Time is money. Thats why lottery winners often take a lump sum payment instead of an annuity. There is nothing wrong with cashing in your chips now vs gambling your winnings for an uncertain future.
    - mcpackieh 3y ago
      I'm not saying a company should never be permitted to accept an acquisition offer. I'm just saying that getting acquired shouldn't be Plan A or their "only exit" as you put it. They should foremost try to make it as their own company, and if that was never going to be feasible for them, then maybe society is better off without that sort of company in the first place.
  - refurb 3y ago
    This comment seems to ignore a huge part of the start-up ecosystem and seems like a great recipe for stiffling innovative, not increasing it.
- uoaei 3y ago
  > random mergers for no reason > only exit left for many companies Quite the injection of hardline ideology in what was otherwise a rather reasoned discussion on economics in the real world.
duped 3y ago
What are your thoughts on increased scrutiny on M&A for the Big Tech Companies affecting the liquidity of startup equity? Meaning, if Big Tech can't buy startups because Big Brother doesn't let them, then how does that impact VC which is based on the principle of there eventually being some liquidity for their investments (which increasingly, are not IPOs).
- jrpt 3y ago
  This is very important and why I wouldn’t consider her pro-startup.
- todd-davies 3y ago
  The VC side isn't my area so I don't think I have very good thoughts on it. Perhaps somebody with more expertise can chime in. That said, there's lots of great work about financialization and antitrust coming out, and I should probably read up on it. With that caveat, I think it's plausible that some startups are/were getting VC funding not because they were good businesses, but rather because they presented enough of a competitive threat to a big tech firm that there was a good chance of a large acquisition. The net effect of those acquisitions is probably to transfer some of the surplus from Big Tech companies into the VC/founder ecosystem. Is that good? Maybe for the founders and VCs. From a social perspective though, we want to ensure that startups can meaningfully contest incumbent firms' market positions, and that can't happen if all the startups get acquired before they get a chance to do so.
andrewjl 3y ago
I'm sure it's been mentioned elsewhere but Lina Khan's Amazon’s Antitrust Paradox[1] ranks among my favorite pieces of legal writing. I think it's all but required reading for anyone who cares about antitrust issues, irrespective of the position one lands on when it comes to specifics. https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.pdf https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p...
barry-cotter 3y ago
Can you provide some links to anything that supports that? Her antitrust philosophy is built on a hostility to business success as such so I don’t see why she would have any positive disposition to smaller businesses.
- stevenwoo 3y ago
  The most recent NPR planet money podcast played their first episode on Ida Tarbell and Standard Oil, the old Bork episode on changing antitrust law enforcement then followed up with a half hour interview with Khan. https://www.npr.org/podcasts/510289/planet-money https://www.npr.org/podcasts/510289/planet-money There’s arguments she makes for fair competition and for monopolies being capable of making anti consumer marketplace decisions. I assume that you are not saying there should not be anti trust or anti monopoly laws, that’s a different argument I think. She doesn’t say anything like what you are claiming here.
- todd-davies 3y ago
  There are lots of different views about the goals of antitrust law and policy, but few (if any) are hostile to business. Khan is pro-business but also, broadly speaking, pro-dispersion of economic power within the economy. That means having fewer 'gatekeeper' firms which exercise power over key economic bottlenecks, and at the same time, a greater focus on helping smaller and medium sized businesses succeed. For a concrete reference regarding small business, see this recent speech of hers [1,2]. [1] https://www.ftc.gov/system/files/ftc_gov/pdf/remarks-chair-khan-small-business-majority-event-noncompete.pdf https://www.ftc.gov/system/files/ftc_gov/pdf/remarks-chair-k... [2] https://www.ftc.gov/news-events/news/speeches/remarks-chair-lina-m-khan-small-business-majority-event-non-compete-agreements https://www.ftc.gov/news-events/news/speeches/remarks-chair-...
ugh123 3y ago
How do Khan's efforts relate to patent law? Does she see her office having influence on that, at least tangentially, to anything happening at USPTO?
- dmoy 3y ago
  The FTC doesn't have a whole lot to do with patents. They have opinions, and occasionally share them. That's about it. That's a whole different ball game where you have to play many-sided gorilla wrestling with the USPTO, the CAFC, and a lot of pharma money.
- huitzitziltzin 3y ago
  >>How do Khan's efforts relate to patent law? Not at all. 0% related. >> Does she see her office having influence on that, at least tangentially, to anything happening at USPTO? If she does she really shouldn’t.
  - ugh123 3y ago
    Thats kind of disappointing. If certain companies are using certain patents to prohibit trade or commerce then that should be fair game to sue companies for.
JumpCrisscross 3y ago
> Khan is massively pro-startup and pro-innovation She’s also ineffective. What she believes may be noble. But the track record of execution has been so poor, you couldn’t have done better if you were trying to plant a stooge at the top.
- Ardon 3y ago
  I mean to call her ineffective we'd need to know how hard the task is. Given the FTC has been a regular target of budget gutting and having hostile chairs appointed for decades, we don't have that information.
  - jgalt212 3y ago
    Indeed, she's been tasked with trying to turn an unassisted triple pay against the '98 Yankees.
    - Apocryphon 3y ago
      Maybe harder than that. Try the ‘90s Bulls.
  - jauntywundrkind 3y ago
    And a deeply deeply biased court system that has been nothing but pro-business for ages. Borkism has been the law of the land & figuring out to how take a judicial system which has been winnowed to just a small narrow view & make it reconsider mandates it used to have, long long ago, requires not just good casework but courts that have re-developed some appetite for ruling in businesses.
- filereaper 3y ago
  >She’s also ineffective. In this recent podcast, Lina Khan explicitly mentions deterrence as a tool in FTC's arsenal and the overall recent setbacks. I do think that getting companies worth $1T to behave is going to take multiple attempts and here we give lots of leeway to Founders and others to iterate and refine. I would like to give Lina Khan the same chances to iterate and refine as I very strongly support the grand parents views of how important this is to innovation and for startups. https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5ucHIub3JnLzUxMDI4OS9wb2RjYXN0LnhtbA/episode/NTViZDdiN2EtZDgyZi00M2Y2LWI5YWYtYTBkZGQxNzVlOTdj?ep=14 https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5ucHIub3J...
jollofricepeas 3y ago
Posting Matt Stoller’s BIG newsletter as a resource. His journalism covering monopolies and related litigation is nothing short of phenomenal. I recommend it to anyone who wants to learn more about how big business works to suppress employees customer and regulator power. https://www.thebignewsletter.com/ https://www.thebignewsletter.com/
- DannyBee 3y ago
  I would call it mostly the opposite (and have given detailed critiques of why before on HN, citing where he is eliding facts or just literally spouting nonsense). I used to subscribe, and read carefully, for years, so this is not a drive by sort of view ;) He certainly appeals to a certain group of people, but I would not call it particularly accurate or correct. He will frequently leave out facts to make a point, even when the facts literally point in the opposite direction. The more I dug, the more obvious this becomes, but it only really takes comparing a single opinion or two to his take on them to become disillusioned with his view. I gave up completely when his view of why the DOJ keeps losing literally became "the judiciary is corrupt" You see - it can't be that the DOJ is wrong, or sucked, that he's wrong, or that his theories are wrong, or anything like that. No, you see, it's everyone else that's the reason. I think he's drunk a little too much of his own koolaid. There are better newsletters if you are looking for a more objective view. If you want subjective but good, that's harder, but Matt ain't it.
  - Sebguer 3y ago
    What are those better newsletters?
    - safety1st 3y ago
      I would like to know too
  - deleted 3y ago
    [deleted]
  - yathaid 3y ago
gms 3y ago
> A tighter merger process might make startup exits through acquisition less common, but it should also make it easier for startups to grow organically into large companies. This is a contradiction. If the likelihood of acquisition goes down, so does the likelihood of startup funding. Which means the likelihood of growing into a large company goes down too. I don't think it's a good idea to want a world where companies like Google are less likely to come about.
- yathaid 3y ago
  What you are missing is when the acquisition happens or the size of the firm being acquired. The blocked M&As are on firms that are already setting the market. Google cannot come about now. There is literally no need to have the world's most used search engine, mobile OS, browser, video streaming website, maps application under the same corporate umbrella. Only one of these was built in-house, every other one was acquired.
  - gms 3y ago
    You say there is 'literally no need'. How are you so confident in making such a claim for the rest of us? I, as a consumer, would rather make that decision myself. If you don't want to use Google Maps that's up to you. I don't see why you'd force me to do the same. As it stands, Maps falling under Google means that I and many others on this planet, from Africa to the Middle East to Asia and others, get to use it for free because it's subsidised by Google's search ads. A standalone maps company would have to charge money to run the service. People around the world (along with businesses small and large) would be poorer if this were the case. I defend your choice to dislike this state of affairs. But it's rather difficult to defend a proclivity to take choice away from the rest of us.
    - yathaid 3y ago
      > A standalone maps company would have to charge money to run the service. Yes. That is typically how businesses work. That cost is being subsidized by an uber-entity that is slurping private data of its more economically valuable customers at every turn. Why is it fair to do that? > But it's rather difficult to defend a proclivity to take choice away from the rest of us. Where is my choice to step out of this Big Brother ecosystem? If Maps was so awesome, why did Google acquire Waze? And why was it allowed to?
dantheman 3y ago
She's not pro-startup and pro-innovation - at least not from anyone who's actually in those fields. If you ask anyone, they'd ask her to go away -- if the people you're pro are against you, then maybe you should rethink your stance.
- Barrin92 3y ago
  like who? I work in tech, and I think she's great. Are we pretending the industry isn't full of Peter Thiel "competition is for losers" aspiring monopolists? This industry has, for probably 15 years now been captured by people whose entire business model is to eliminate competition and collect platform rent. Our opinions are about as reliable as Volkswagen's opinion on emissions.
  - omnimus 3y ago
    Platform capitalism / technofeudalism
scythe 3y ago
Mergers seem like the smaller concern for innovation. The big concern from the point of view of a startup is "what if BigCorp just imitates your product and puts you out of business?" Historically, this situation has been managed through intellectual property laws, not antitrust. But patents as applied to software are a kludge, both tying up tech that should be free (particularly when that technology is a file format) and failing to protect innovations that should reward their developers. And copyright just doesn't cut it.
- todd-davies 3y ago
  Good point. I don't think the FTC is myopically focused on mergers, but on anti-competitive behaviour in general. That said, I don't think we have a good handle on the imitation problem, there's probably some great research questions to ask in that area.
crotchfire 3y ago
[dead]
jauntywundrkind 3y ago
There was some buzz about "competitive compatibility", making it so sites couldn't lock in user so much. I wish we saw more action on that front. That feels like the remedy to the status quo being so well entrenched, like a precondition for a competitive digital world. Just trying to block Mergers & Acquisitions might some day allow new giant powers to arise & compete, but we need a system where competing & growing a presence isn't so outright impossible. Link from 2020 with a roundup of competitive compatibility news, https://www.eff.org/deeplinks/2020/12/competitive-compatibility-year-review https://www.eff.org/deeplinks/2020/12/competitive-compatibil...

wskinner 3y ago

> Part of her agenda is strengthening the merger review process. Merger review is intrinsically hard, because authorities essentially have to try and figure out what the effect will be if the merger is allowed or denied. There is no crystal ball for this, and there are rarely 'right' answers. Yet the merger regime has been very favourable to large firms over the past few decades, and there's a reasonable consensus in the antitrust community that it should be strengthened. A tighter merger process might make startup exits through acquisition less common, but it should also make it easier for startups to grow organically into large companies. In terms of creating a bottom-up and more pluralistic Silicon Valley, that seems like a win to me. Serious question: what is the "antitrust community"? Can you shed some light on the theory that making mergers more difficult would either a) make it easier for startups to grow organically or b) benefit society in general? If the upside from working at or creating a startup is due to some combination of IPO or acquisition (this is of course a simplified model), and acquisitions are made more difficult, why do you assume that IPOs would become more likely or more lucrative? Once upside is removed from the startup ecosystem, how will potential employees and founders respond at the margin? I'm struggling to see an equilibrium here that involves more rather than less money and work poured into startups.

catlover76 3y ago
> Serious question: what is the "antitrust community"? Not the poster, but I would assume it refers to the people who follow developments in antitrust law and the enforcement thereof (so antitrust lawyers, basically).
- dmoy 3y ago
  > so antitrust lawyers, basically). Well, and lawyers-turned-professor and/or treatise authors (who are typically professors). Often the experts turn towards academia if they're truly in it just to know everything about the field. So, Hovencamp, etc. "Legal scholar" if you will
todd-davies 3y ago
The "antitrust community" is people working in antitrust law/policy/academia who write, tweet, speak at conferences, etc. Two caveats are that a) this is my view based on personal observations, and b) that a consensus doesn't mean that everybody agrees. Undisputedly however, there is a lot of academic work these days which comes to the conclusion that merger review should be strengthened. For instance, see [1]. Khan's aim isn't necessarily to make mergers more difficult, or to prevent them per se. Rather, it's to make a more concerted effort to prevent mergers which on balance, appear not to be in the public interest. There are several reasons why a merger might be harmful. First, some mergers are "killer acquisitions" whereby a large firm will acquire a "nascent" competitor and then discontinue its product (e.g. [2]). One danger here is that killer acquisitions nip start-up competition in the bud, such that new firms don't have a chance to grow and compete against incumbent firms. That's a problem because competition means that consumers, rather than incumbent firms, ultimately get to choose market outcomes. If there is no choice, then consumers can't choose. The ultimate failure mode here is some kind of command economy where monopoly firms get to make most of the decisions about how markets work and consumers get little say at all. Second, mergers lead to market concentration because you're taking a market with n firms and moving to a market with n-1 firms. Market concentration isn't inherently bad, indeed, some markets are 'naturally' concentrated. That said unconcentrated markets are generally preferred to concentrated ones because concentrated markets can lead to things like tacit collusion (which has similar outcomes to a cartel) [3]. Third, if there is a real possibility for startups to grow organically and challenge large incumbent firms for the market, then theory goes that VC funding could be stimulated on the promise of a potentially huge return. For instance, a VC might be willing to fund a firm if there's a 5% chance that it will be the next Google, but not if there's a 10% chance that it gets acquired in a year or two. You make a good point regarding acquisitions, IPOs and the personal incentives to work at a startup. I'm not assuming that IPO's would become more likely or lucrative; I don't have a view on that (except perhaps what I said in the previous paragraph). I guess if a firm was going to be successful, and a merger wasn't an option then it would eventually IPO instead, no? That might lead to delayed compensation, but it shouldn't affect the viability of a solid business. Fewer acquisitions might end up with some firms failing before IPO which would have otherwise been acquired. That's bad from the perspective of those at the firm, but isn't inherently bad from a social perspective. After all competition necessarily entails winners and losers. If all else fails, there is a 'failing firm defence' which would allow an acquisition if the only other option is the firm going out of business [4]. Finally, the lack of enforcement over the past few decades hasn't given regulators much opportunity to "learn" what is a good/bad merger. A more active merger review policy would entail regulators building up expertise and fine-tuning their approach. It's important to remember that merger control isn't necessarily adversarial. At its best, it's a positive-sum dialogue between firms who want to do business and regulators who are trying to provide public-minded oversight. [1] Kwoka, John. "The structural presumption and the safe harbor in merger review: False positives or unwarranted concerns." Antitrust LJ 81 (2016): 837. https://heinonline.org/HOL/Page?handle=hein.journals/antil81&div=36&g_sent=1&casa_token=92W9pnae2VUAAAAA:O9RRAyIhFsl9dpI-EScM1GrazYaiZnbOnQZZkYqEUSS6or0gBuWP_fClP_yBOnR5HwZdCW9u&collection=journals https://heinonline.org/HOL/Page?handle=hein.journals/antil81... [2] https://news.ycombinator.com/item?id=38145568 https://news.ycombinator.com/item?id=38145568 [3] https://www.tutor2u.net/economics/reference/oligopoly-tacit-collusion https://www.tutor2u.net/economics/reference/oligopoly-tacit-... [4] https://www.concurrences.com/en/dictionary/Failing-firm-defence https://www.concurrences.com/en/dictionary/Failing-firm-defe...

IG_Semmelweiss 3y ago

Lina Khan's vision is one of contempt of the law and disregard of due process. A society where rules are made up on the fly based on whats popular and where the political wind blows [1] Lina Khan's direct actions of regulation-by-the-hip , and continued losses in the courtroom, will weaken actual anticompetitive powers, and ultimately favor monopoly generation by big entrenched players [1] I dont want the govt to make up rules on the fly. Even if its going after monopolistic companies. Because I know its only a matter of time until the govt uses the same pretext to come after me, too. [1] https://archive.vn/aXD6T https://archive.vn/aXD6T

janalsncm 3y ago
> A society where rules are made up on the fly based on whats popular and where the political wind blows Sorry, where do you think laws come from? They’re not written on stone tablets at the top of a mountain. They’re written by people for people. If you prefer Robert Bork’s hands off approach to markets that’s your prerogative but we can’t separate laws and regulations from their consequences. There’s no question in my mind that Amazon’s market share allows them to push their weight around in ways that raise prices for consumers as well as stifle competition and make workers’ lives worse.
- IG_Semmelweiss 3y ago
  [flagged]
- wskinner 3y ago
  In the United States, laws come from Congress.
  - astrange 3y ago
    SCOTUS is unfortunately more powerful than Congress, at least because they're more capable of doing things. Luckily they're more aligned with consumer welfare, which is good, as opposed to Khan's hippie "everything big must be bad" standard. This only supports small business owners and VCs, who are probably the most evil people in the US.

sashank_1509 3y ago

She made her career or reinventing the definition of monopoly to include Amazon and big tech companies to date. At worst she’s a cynical, corrupt government apparatchik who uses the massive hammer of the government to bully productive industries and enrich herself with fame and money. At best she is an ignorant, foolish government apparatchik who squeezes the goose laying golden eggs to death and then wonders how she managed to make the worlds most innovative place completely barren of innovation, vitality thus dooming her society. She almost makes me want to vote republican, and that’s saying something as I’ve never voted republican my entire life.

andsoitis 3y ago
> She made her career or reinventing the definition of monopoly to include Amazon and big tech companies to date. Is this what you're referring to? https://www.npr.org/2021/07/01/1011907383/new-ftc-chair-lina-khan-wants-to-redefine-monopoly-power-for-the-age-of-big-tech https://www.npr.org/2021/07/01/1011907383/new-ftc-chair-lina...
Conscat 3y ago
If she did actually redefine monopoly in that way, without more detail it at least sounds like a useful redefinition.
patmorgan23 3y ago
No she made her career by stating the obvious that maybe it wasn't a good idea for the FTC to forgo anti-trust enforcement for 40 years. Oh no the trillion dollar tech giants have to undergo some scrutiny, how ever will they continue to pay their executives and shareholders millions.
- dang 3y ago
  Please don't respond to a bad comment by breaking the site guidelines yourself. That only makes things worse. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
catlover76 3y ago

IG_Semmelweiss 3y ago

Killing random mergers for no reason, is killing the only exit left for many companies (the IPO door is closed now). That is massively anti-startup in my book.

mcpackieh 3y ago
Maybe companies should try being profitable instead of being acquisition bait.
- IG_Semmelweiss 3y ago
  Thats a strange take. Time is money. Thats why lottery winners often take a lump sum payment instead of an annuity. There is nothing wrong with cashing in your chips now vs gambling your winnings for an uncertain future.
  - mcpackieh 3y ago
    I'm not saying a company should never be permitted to accept an acquisition offer. I'm just saying that getting acquired shouldn't be Plan A or their "only exit" as you put it. They should foremost try to make it as their own company, and if that was never going to be feasible for them, then maybe society is better off without that sort of company in the first place.
- refurb 3y ago
  This comment seems to ignore a huge part of the start-up ecosystem and seems like a great recipe for stiffling innovative, not increasing it.
uoaei 3y ago
> random mergers for no reason > only exit left for many companies Quite the injection of hardline ideology in what was otherwise a rather reasoned discussion on economics in the real world.

duped 3y ago

What are your thoughts on increased scrutiny on M&A for the Big Tech Companies affecting the liquidity of startup equity? Meaning, if Big Tech can't buy startups because Big Brother doesn't let them, then how does that impact VC which is based on the principle of there eventually being some liquidity for their investments (which increasingly, are not IPOs).

jrpt 3y ago
This is very important and why I wouldn’t consider her pro-startup.
todd-davies 3y ago
The VC side isn't my area so I don't think I have very good thoughts on it. Perhaps somebody with more expertise can chime in. That said, there's lots of great work about financialization and antitrust coming out, and I should probably read up on it. With that caveat, I think it's plausible that some startups are/were getting VC funding not because they were good businesses, but rather because they presented enough of a competitive threat to a big tech firm that there was a good chance of a large acquisition. The net effect of those acquisitions is probably to transfer some of the surplus from Big Tech companies into the VC/founder ecosystem. Is that good? Maybe for the founders and VCs. From a social perspective though, we want to ensure that startups can meaningfully contest incumbent firms' market positions, and that can't happen if all the startups get acquired before they get a chance to do so.

andrewjl 3y ago

I'm sure it's been mentioned elsewhere but Lina Khan's Amazon’s Antitrust Paradox[1] ranks among my favorite pieces of legal writing. I think it's all but required reading for anyone who cares about antitrust issues, irrespective of the position one lands on when it comes to specifics. https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.pdf https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p...

barry-cotter 3y ago

Can you provide some links to anything that supports that? Her antitrust philosophy is built on a hostility to business success as such so I don’t see why she would have any positive disposition to smaller businesses.

stevenwoo 3y ago
The most recent NPR planet money podcast played their first episode on Ida Tarbell and Standard Oil, the old Bork episode on changing antitrust law enforcement then followed up with a half hour interview with Khan. https://www.npr.org/podcasts/510289/planet-money https://www.npr.org/podcasts/510289/planet-money There’s arguments she makes for fair competition and for monopolies being capable of making anti consumer marketplace decisions. I assume that you are not saying there should not be anti trust or anti monopoly laws, that’s a different argument I think. She doesn’t say anything like what you are claiming here.
todd-davies 3y ago
There are lots of different views about the goals of antitrust law and policy, but few (if any) are hostile to business. Khan is pro-business but also, broadly speaking, pro-dispersion of economic power within the economy. That means having fewer 'gatekeeper' firms which exercise power over key economic bottlenecks, and at the same time, a greater focus on helping smaller and medium sized businesses succeed. For a concrete reference regarding small business, see this recent speech of hers [1,2]. [1] https://www.ftc.gov/system/files/ftc_gov/pdf/remarks-chair-khan-small-business-majority-event-noncompete.pdf https://www.ftc.gov/system/files/ftc_gov/pdf/remarks-chair-k... [2] https://www.ftc.gov/news-events/news/speeches/remarks-chair-lina-m-khan-small-business-majority-event-non-compete-agreements https://www.ftc.gov/news-events/news/speeches/remarks-chair-...

ugh123 3y ago

How do Khan's efforts relate to patent law? Does she see her office having influence on that, at least tangentially, to anything happening at USPTO?

dmoy 3y ago
The FTC doesn't have a whole lot to do with patents. They have opinions, and occasionally share them. That's about it. That's a whole different ball game where you have to play many-sided gorilla wrestling with the USPTO, the CAFC, and a lot of pharma money.
huitzitziltzin 3y ago
>>How do Khan's efforts relate to patent law? Not at all. 0% related. >> Does she see her office having influence on that, at least tangentially, to anything happening at USPTO? If she does she really shouldn’t.
- ugh123 3y ago
  Thats kind of disappointing. If certain companies are using certain patents to prohibit trade or commerce then that should be fair game to sue companies for.

JumpCrisscross 3y ago

> Khan is massively pro-startup and pro-innovation She’s also ineffective. What she believes may be noble. But the track record of execution has been so poor, you couldn’t have done better if you were trying to plant a stooge at the top.

Ardon 3y ago
I mean to call her ineffective we'd need to know how hard the task is. Given the FTC has been a regular target of budget gutting and having hostile chairs appointed for decades, we don't have that information.
- jgalt212 3y ago
  Indeed, she's been tasked with trying to turn an unassisted triple pay against the '98 Yankees.
  - Apocryphon 3y ago
    Maybe harder than that. Try the ‘90s Bulls.
- jauntywundrkind 3y ago
  And a deeply deeply biased court system that has been nothing but pro-business for ages. Borkism has been the law of the land & figuring out to how take a judicial system which has been winnowed to just a small narrow view & make it reconsider mandates it used to have, long long ago, requires not just good casework but courts that have re-developed some appetite for ruling in businesses.
filereaper 3y ago
>She’s also ineffective. In this recent podcast, Lina Khan explicitly mentions deterrence as a tool in FTC's arsenal and the overall recent setbacks. I do think that getting companies worth $1T to behave is going to take multiple attempts and here we give lots of leeway to Founders and others to iterate and refine. I would like to give Lina Khan the same chances to iterate and refine as I very strongly support the grand parents views of how important this is to innovation and for startups. https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5ucHIub3JnLzUxMDI4OS9wb2RjYXN0LnhtbA/episode/NTViZDdiN2EtZDgyZi00M2Y2LWI5YWYtYTBkZGQxNzVlOTdj?ep=14 https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5ucHIub3J...

jollofricepeas 3y ago

Posting Matt Stoller’s BIG newsletter as a resource. His journalism covering monopolies and related litigation is nothing short of phenomenal. I recommend it to anyone who wants to learn more about how big business works to suppress employees customer and regulator power. https://www.thebignewsletter.com/ https://www.thebignewsletter.com/

DannyBee 3y ago
I would call it mostly the opposite (and have given detailed critiques of why before on HN, citing where he is eliding facts or just literally spouting nonsense). I used to subscribe, and read carefully, for years, so this is not a drive by sort of view ;) He certainly appeals to a certain group of people, but I would not call it particularly accurate or correct. He will frequently leave out facts to make a point, even when the facts literally point in the opposite direction. The more I dug, the more obvious this becomes, but it only really takes comparing a single opinion or two to his take on them to become disillusioned with his view. I gave up completely when his view of why the DOJ keeps losing literally became "the judiciary is corrupt" You see - it can't be that the DOJ is wrong, or sucked, that he's wrong, or that his theories are wrong, or anything like that. No, you see, it's everyone else that's the reason. I think he's drunk a little too much of his own koolaid. There are better newsletters if you are looking for a more objective view. If you want subjective but good, that's harder, but Matt ain't it.
- Sebguer 3y ago
  What are those better newsletters?
  - safety1st 3y ago
    I would like to know too
- deleted 3y ago
  [deleted]
- yathaid 3y ago

gms 3y ago

> A tighter merger process might make startup exits through acquisition less common, but it should also make it easier for startups to grow organically into large companies. This is a contradiction. If the likelihood of acquisition goes down, so does the likelihood of startup funding. Which means the likelihood of growing into a large company goes down too. I don't think it's a good idea to want a world where companies like Google are less likely to come about.

yathaid 3y ago
What you are missing is when the acquisition happens or the size of the firm being acquired. The blocked M&As are on firms that are already setting the market. Google cannot come about now. There is literally no need to have the world's most used search engine, mobile OS, browser, video streaming website, maps application under the same corporate umbrella. Only one of these was built in-house, every other one was acquired.
- gms 3y ago
  You say there is 'literally no need'. How are you so confident in making such a claim for the rest of us? I, as a consumer, would rather make that decision myself. If you don't want to use Google Maps that's up to you. I don't see why you'd force me to do the same. As it stands, Maps falling under Google means that I and many others on this planet, from Africa to the Middle East to Asia and others, get to use it for free because it's subsidised by Google's search ads. A standalone maps company would have to charge money to run the service. People around the world (along with businesses small and large) would be poorer if this were the case. I defend your choice to dislike this state of affairs. But it's rather difficult to defend a proclivity to take choice away from the rest of us.
  - yathaid 3y ago
    > A standalone maps company would have to charge money to run the service. Yes. That is typically how businesses work. That cost is being subsidized by an uber-entity that is slurping private data of its more economically valuable customers at every turn. Why is it fair to do that? > But it's rather difficult to defend a proclivity to take choice away from the rest of us. Where is my choice to step out of this Big Brother ecosystem? If Maps was so awesome, why did Google acquire Waze? And why was it allowed to?

dantheman 3y ago

She's not pro-startup and pro-innovation - at least not from anyone who's actually in those fields. If you ask anyone, they'd ask her to go away -- if the people you're pro are against you, then maybe you should rethink your stance.

Barrin92 3y ago
like who? I work in tech, and I think she's great. Are we pretending the industry isn't full of Peter Thiel "competition is for losers" aspiring monopolists? This industry has, for probably 15 years now been captured by people whose entire business model is to eliminate competition and collect platform rent. Our opinions are about as reliable as Volkswagen's opinion on emissions.
- omnimus 3y ago
  Platform capitalism / technofeudalism

scythe 3y ago

Mergers seem like the smaller concern for innovation. The big concern from the point of view of a startup is "what if BigCorp just imitates your product and puts you out of business?" Historically, this situation has been managed through intellectual property laws, not antitrust. But patents as applied to software are a kludge, both tying up tech that should be free (particularly when that technology is a file format) and failing to protect innovations that should reward their developers. And copyright just doesn't cut it.

todd-davies 3y ago
Good point. I don't think the FTC is myopically focused on mergers, but on anti-competitive behaviour in general. That said, I don't think we have a good handle on the imitation problem, there's probably some great research questions to ask in that area.

crotchfire 3y ago

[dead]

jauntywundrkind 3y ago

There was some buzz about "competitive compatibility", making it so sites couldn't lock in user so much. I wish we saw more action on that front. That feels like the remedy to the status quo being so well entrenched, like a precondition for a competitive digital world. Just trying to block Mergers & Acquisitions might some day allow new giant powers to arise & compete, but we need a system where competing & growing a presence isn't so outright impossible. Link from 2020 with a roundup of competitive compatibility news, https://www.eff.org/deeplinks/2020/12/competitive-compatibility-year-review https://www.eff.org/deeplinks/2020/12/competitive-compatibil...