South Korea's lessons in reining in tech giants

When South Korea banned Apple and Google from requiring developers to use their own payment systems, the world took note of this strident new attitude to regulation – now, as the country attempts to restore a balance between its home grown giants and the small businesses that must use them, the question of what tech is for bubbles to the surface.

Why it matters

Tracked in a fantastic piece in Rest of World, South Korea’s regulatory nerve has emerged as an example to governments and campaigners that envy the resolve with which the country cracked down on anti-competitive behaviour. It’s possible to learn more from struggles than from successes, and this story provides both.

What’s happening

• Following the Apple and Google curbs, which have inspired similar proceedings elsewhere, the next companies in line to have their businesses examined were home-grown platform companies like the super-app operator Kakao. These were different from production-focused firms that make up the Chaebol like Samsung that had been fundamental to Korea’s technological prowess.
• The new generation comprises more complicated entities whose place in the economy and media ecosystem of the country – how citizens pay each other, how they find information – means their positions, strengthened by the network effects that make them useful in the first place, are ripe to be abused.
• Inequality is on the rise in South Korea, and legislators are keen that a new dominant Chaebol of platform companies cannot emerge. New bills now aim to place a limit on what sectors these firms can enter and establish standards for B2B relations, Rest of World reports.
• The trouble is whether it will stifle innovation or whether tech has come to believe the only model for growth is unfettered domination depending on who has the deepest pockets.

Sourced from Rest of World, CNBC, TechCrunch