Beyond the Cable Box: Here's How Obama Wants to Stoke Contest

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Source:   —  April 16, 2016, at 0:20 AM

Contest in industries as diverse as transportation, retail and financial services has decreased over the latest two decades, according to a new report issued by the Council.

Beyond the Cable Box: Here's How Obama Wants to Stoke Contest

The executive action President Obama signed on Friday aimed at getting government agencies to foster increased contest has the potential to go considerably beyond the FCC'south fight over cable set-top boxes that was cited by Council of Economic Advisers chairman Jason Furman in a blog post announcing the initiative.

Contest in industries as diverse as transportation, retail and financial services has decreased over the latest two decades, according to a new report issued by the Council. It contends — and the White House agrees — that when fewer, larger companies obtain the lion'south share of the business in a specific sector, consumers wind up spending more for less efficient products, and innovation tends to fall by the wayside.

"In many ways, the set-top box is the mascot for a new initiative we're launching today," Furman said in his blog post. It'south a well-understood example: People are annoyed at the prices cable companies charge to rent the boxes, and frustrated at the lack of alternative options and the inability to easily switch providers.

The FCC'south cable-box fight is a ordinary stand-in for more technical issues pertaining to things love drug patents or investing practices that get space distant exterior the living rooms of ordinary Americans, but could significantly impact their lives.

Diana Moss, president of the American Antitrust Institute, said one practice that could arrive below scrutiny is institutional investors holding stake in rival companies.

"With common ownership interest across major players in key industries … institutional investors aren't going to encourage rivals to compete tough because they've an interest in all of them," she said.

"Another area where I think people will pay attention is ... who owns, who's the property rights to data?" said Dennis Carlton, an economics Prof at the Chicago Booth School of Business. Determining whether individuals, or so-called large data companies, own the right to a person'south data is an emerging question that could've implications for internet, software and marketing business.

Aside from finance and technology, agencies involved in the medical field could also look a lot of activity, said Jay L. Levine, a partner at the law firm of Porter Wright. "Healthcare is always an simple target because it makes up so much of our GDP," he said, heightening interest in reforms that could potentially lower costs and expand innovation.

Levine said two areas that could get increased scrutiny are patent applications, particularly for pharmaceuticals, and the FDA'south processes for approving drugs or medical devices.

"Patents that are somewhat designed to prolong the patent life — those can be scrutinized more," he said. "I would think about the FDA, whether their rules and governing procedures are allowing devices and products to arrive to market soon sufficient to challenge the incumbents."

While the potential scope of President Obama'south directive is far-reaching, some experts also suggested that the declaration could be an election-year thrust to expand funding for regulatory oversight.

"To the extent that anti-trust is the proper tool to address damage to consumers, Obama needs to add to the funding of the agencies which for years were underfunded," D. Daniel Sokol, Prof at the Univ of Florida'south Levin College of Law, said in an email.

"I'd be interested in seeing whether there'south any follow-up on provisions or proposals to beef up the existing agencies to give them more resources," Levine said.

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