To tackle Google’s power, regulators have to go after its ownership of data

[Commentary] The problem with regulating technology companies is that, faced with tough new rules, they can eventually innovate their way out, often by switching to newer, unregulated technologies. The risk of targeted regulation informed by little other than economic doctrines might even be fuelling a corporate quest for eternal disruption: instead of surrendering to the regulators, technology firms prefer to abandon their old business model. It’s through this lens that we should interpret the likely fallout from the €2.4bn fine imposed on Alphabet, Google’s parent company, by the European commission. It arrives after a lengthy, seven-year investigation into whether the company abused its dominance to promote its own online shopping service above search results. The commission’s case seems sound; the sad fate of small online retailers, unable to compete with Alphabet over the past decade, suggests as much.

However, one should not mistake the factual correctness of the commission’s case for an informed strategic vision: if it has a clue about effective ways to limit the power of data platforms, it’s not showing it. The reality is that even though advertising-powered search still accounts for the bulk of Alphabet’s earnings, the company’s real focus these days is on finding lucrative and creative uses for the troves of data that it has already extracted, processed and turned into artificial intelligence. Alphabet’s future revolves around information-intensive services, not around running matchmaking platforms for advertising.

[Evgeny Morozov is a visiting scholar at Stanford University and a Schwartz fellow at the New America Foundation.]