Competition Law and Future Oversight of Continuity-Based Dominance

1. Introduction

Continuity-based dominance refers to a form of market power in which an undertaking maintains or reinforces its dominant position over time because of cumulative advantages such as network effects, accumulated data, switching costs, interoperability control, installed user bases, reputation, technological ecosystems, contractual relationships, learning effects, and control over essential inputs or interfaces.

Traditional competition law often asks whether a firm is dominant at a particular point in time. Future competition oversight increasingly needs to ask a different question:

What mechanisms allow market power to persist from one competitive period into the next, and do those mechanisms prevent effective competitive displacement?

This distinction is especially important in digital, AI, cloud, telecommunications, financial technology, energy, transport and other technology-intensive markets.

Article 102 TFEU prohibits abusive conduct by dominant undertakings, while modern merger policy increasingly considers whether transactions can entrench or extend existing market power. The European Commission's 2026 Article 102 Guidelines expressly seek greater consistency in assessing exclusionary conduct.

2. Meaning of Continuity-Based Dominance

Continuity-based dominance exists where today's market power creates conditions that make tomorrow's competition weaker.

A simplified model is:

Existing market power → advantage accumulation → higher switching costs/network effects → reduced rival opportunities → continued dominance → further accumulation

For example:

Large user base
↓
More data and interactions
↓
Better algorithm/service
↓
More users
↓
More complementary developers
↓
Higher switching costs
↓
Greater attractiveness of the platform
↓
Further market expansion

The critical competition-law issue is therefore not simply market share, but the mechanism through which market power becomes self-reinforcing.

3. Core Characteristics

A. Persistence

Dominance continues for an extended period rather than representing a temporary market-share advantage.

B. Cumulative advantages

The dominant undertaking accumulates:

• user data;
• technological knowledge;
• infrastructure;
• distribution relationships;
• intellectual property;
• developer ecosystems;
• customer histories;
• interoperability advantages; and
• behavioural information.

C. Path dependence

Past competitive events influence present competition.

A firm that became large earlier may possess advantages that a new entrant cannot realistically reproduce even if the entrant has comparable technology.

D. Switching costs

Customers may face financial, technical, contractual or informational costs in moving to competitors.

E. Network effects

The value of a service can increase as more users, developers, merchants or complementary providers participate.

F. Ecosystem reinforcement

Dominance in one market may support expansion into neighbouring markets.

G. Control over interfaces

APIs, operating systems, app stores, technical standards and interoperability arrangements can become mechanisms through which continuity is maintained.

4. Traditional Dominance vs Continuity-Based Dominance

Thus, continuity-based analysis does not replace conventional dominance analysis. It adds a temporal dimension.

5. Legal Framework

A. Article 102 TFEU

Article 102 addresses abusive conduct by dominant undertakings.

Continuity-based concerns may arise through:

• exclusionary rebates;
• tying and bundling;
• discriminatory access;
• refusal to supply;
• interoperability restrictions;
• self-preferencing;
• exclusive arrangements;
• degradation of competing products;
• discriminatory data access;
• leveraging into adjacent markets.

The European Commission's current Article 102 framework expressly covers exclusionary conduct capable of excluding competitors.

B. Section 2 of the Sherman Act

US antitrust law similarly distinguishes between possessing monopoly power and acquiring or maintaining that power through exclusionary conduct.

The central question is generally whether conduct unlawfully maintains or extends monopoly power rather than merely reflecting superior competition.

C. Merger control

Continuity-based dominance is particularly relevant to merger review.

A merger can potentially:

• eliminate an emerging challenger;
• reinforce network effects;
• combine complementary datasets;
• increase switching costs;
• extend ecosystem control;
• remove future competitive constraints.

The US DOJ's merger guidelines specifically recognise that mergers may create durable market power and consider longer-term effects involving entry, investment, innovation and competitive disruption.

D. Digital Markets Regulation

The EU Digital Markets Act introduces a more prospective model for certain designated gatekeepers.

The European Commission designated Alphabet, Amazon, Apple, ByteDance, Meta and Microsoft as gatekeepers in 2023.

This illustrates a movement from purely retrospective antitrust enforcement toward ongoing obligations designed to prevent market structures from becoming permanently self-reinforcing.

6. Six Major Case Laws

1. United States v. Microsoft Corp. — 253 F.3d 34 (D.C. Cir. 2001)

Facts

Microsoft possessed substantial power in the market for Intel-compatible PC operating systems. The government challenged Microsoft's conduct toward competing browsers, particularly Netscape.

Principle

The case demonstrated how a dominant firm can use control over one technological layer to protect its position against an emerging competitive threat.

Microsoft's conduct was examined not merely by asking whether Windows was dominant, but by considering how Microsoft's conduct could preserve that dominance against technological displacement.

Relevance to continuity-based dominance

This is a foundational example because:

Existing operating-system dominance → control over distribution → protection against browser competition → preservation of ecosystem power.

The case illustrates why future oversight must examine whether a dominant platform is using its existing position to prevent the next generation of competition.

7. Aspen Skiing Co. v. Aspen Highlands Skiing Corp. — 472 U.S. 585 (1985)

Facts

Four major ski areas operated in Aspen. Aspen Skiing controlled three of them and eventually withdrew from a cooperative ticket arrangement involving Aspen Highlands.

Principle

The Supreme Court considered the dominant firm's termination of an established course of dealing and the sacrifice of short-term benefits.

The case is important to continuity analysis because historical commercial relationships can themselves become relevant evidence of competitive conditions.

Continuity dimension

The critical concept is the interruption of an established competitive relationship.

It demonstrates that competition law can consider:

• historical cooperation;
• changes in access;
• exclusionary consequences;
• short-term sacrifice;
• long-term competitive effects.

The later Trinko decision emphasised the exceptional nature of the Aspen Skiing circumstances.

8. Verizon Communications Inc. v. Trinko — 540 U.S. 398 (2004)

Facts

The case concerned alleged discriminatory access to telecommunications infrastructure.

Principle

The Supreme Court emphasised that antitrust law generally does not impose a broad duty upon firms to deal with competitors.

At the same time, the Court discussed Aspen Skiing as an exceptional situation involving termination of a prior voluntary course of dealing.

Continuity significance

Trinko is important because it establishes an important limit:

Continuity of commercial relationships cannot automatically create a permanent obligation to supply competitors.

Therefore, future oversight must distinguish between:

legitimate independent commercial decisions

and

conduct that uses accumulated market power to exclude competition in legally cognisable circumstances.

9. Eastman Kodak Co. v. Image Technical Services, Inc. — 504 U.S. 451 (1992)

Facts

Kodak manufactured photocopiers and micrographic equipment while independent service organisations provided maintenance services.

Kodak changed its policies concerning access to replacement parts.

Principle

The Supreme Court recognised that competition analysis could not always be reduced to the market for the primary equipment alone.

Customer dependence and switching costs could create competitive significance in an aftermarket.

Continuity-based significance

Kodak is particularly relevant because it illustrates installed-base power.

The sequence can be represented as:

Initial equipment purchase → customer becomes installed-base user → dependence on parts/service → switching becomes costly → aftermarket power

This is one of the clearest historical foundations for analysing continuity through lock-in and lifecycle dependence.

10. Google Android — European Commission, Case AT.40099

Facts

The European Commission investigated Google's practices concerning Android, including contractual arrangements involving manufacturers, app stores and search services.

The Commission concluded that Google held dominant positions in relevant markets and found several practices to be abusive.

The Commission's decision identified Google's dominance in licensable smart mobile operating systems and noted barriers to entry, lack of countervailing buyer power and insufficient indirect constraints.

Continuity significance

Android demonstrates how dominance can be reinforced through a technological ecosystem.

The relevant chain includes:

Operating system → device manufacturers → pre-installed applications → user behaviour → search usage → data → advertising ecosystem

This creates a feedback mechanism capable of reinforcing an existing position.

11. Google Search (Shopping) — European Commission, Case AT.39740

Facts

The European Commission found that Google had abused its dominant position in general search by giving advantageous treatment to its own comparison-shopping service.

Continuity significance

The case illustrates leveraging across connected markets.

A dominant position in general search can potentially provide advantages in comparison-shopping services because the dominant platform controls a major gateway through which consumers access information.

The underlying continuity concern is:

Gateway dominance → preferential treatment → increased visibility → greater user traffic → stronger commercial position → reinforcement of ecosystem power.

The Commission's broader digital enforcement record identifies Google Shopping among its major digital competition interventions.

12. Intel v. Commission — Case C-413/14 P

Facts

The EU institutions examined Intel's conditional rebates to major computer manufacturers and distributor Media-Saturn.

Principle

The case became an important reference point for analysing whether rebates offered by a dominant firm are capable of producing exclusionary effects.

Continuity significance

Rebate systems may matter to continuity-based dominance where they make it harder for rivals to obtain the scale necessary to challenge an incumbent.

The relevant dynamic can be:

Incumbent scale → conditional commercial incentives → reduced rival access → insufficient rival scale → continued incumbent advantage.

The lesson is that competition authorities may need to examine how conduct affects the ability of rivals to expand over time, rather than looking only at immediate price effects.

13. Additional Relevant Case: Google Search / AdSense

Google's search-related conduct provides another useful continuity model.

The European Commission has treated restrictions in search advertising as potentially capable of protecting an established position. Its competition materials describe the AdSense case as involving restrictions that protected Google's dominance in search advertising.

The continuity mechanism can be understood as:

Search dominance → advertising demand → advertiser relationships → data accumulation → improved monetisation → stronger ecosystem position.

14. Major Forms of Continuity-Based Dominance

14.1 Data Continuity

Data accumulated yesterday may improve a product tomorrow.

For example:

more users → more data → better prediction → better service → more users.

Future competition law may therefore examine whether competitors have realistic access to equivalent sources of data.

The issue is already visible in EU digital regulation. In July 2026, the European Commission adopted measures requiring Google to facilitate access to anonymised search data for eligible competing search engines under the DMA.

14.2 Network-Effect Continuity

Platforms may become progressively harder to challenge as participation increases.

Examples include:

• social networks;
• payment systems;
• marketplaces;
• operating systems;
• app stores;
• professional networks.

The critical question becomes whether network effects are:

contestable

or

self-reinforcing and exclusionary.

15. Switching-Cost Continuity

Switching costs can preserve dominance even when alternative products technically exist.

Costs may include:

• data migration;
• retraining;
• contractual termination;
• loss of interoperability;
• loss of accumulated reputation;
• loss of customer history;
• loss of ecosystem compatibility.

This creates an important distinction between:

availability of an alternative

and

effective ability to move to that alternative.

16. Ecosystem Continuity

Modern dominance may not reside in one product.

A firm may control:

operating system + browser + search + cloud + advertising + payments + AI assistant.

Dominance can therefore be transmitted between markets.

This is one reason merger authorities increasingly examine conglomerate and interoperability effects. EU merger policy has previously examined interoperability and access-degradation concerns in transactions involving technology ecosystems, including Intel/McAfee, Microsoft/LinkedIn, Broadcom/Brocade and Siemens Healthineers/Varian.

17. Interoperability as a Continuity Mechanism

A dominant platform can potentially maintain its position by controlling:

• APIs;
• technical standards;
• operating-system functions;
• authentication;
• data portability;
• hardware interfaces;
• app distribution.

Consequently, future competition oversight may ask:

Does the dominant undertaking compete on the merits, or does it control the technical conditions necessary for competitors to compete?

The EU's 2026 Android measures are an important contemporary illustration: the Commission required measures intended to allow competing AI services more effective access to Android capabilities.

18. AI and Continuity-Based Dominance

AI markets create a particularly important continuity problem.

A leading AI system can potentially benefit from:

users → queries → feedback → data → model improvement → better outputs → more users.

At the infrastructure level:

compute → model development → users → revenue → additional compute → improved model capability.

Competition authorities may therefore need to monitor:

• access to computing resources;
• foundation-model distribution;
• training data;
• AI model interoperability;
• cloud-model integration;
• default placement;
• API access;
• switching costs;
• acquisition of emerging AI competitors.

19. Future Competition Oversight Framework

A future-oriented authority could analyse continuity-based dominance through seven stages.

Stage 1 — Identify current market power

Examine:

• market shares;
• entry barriers;
• buyer power;
• network effects;
• infrastructure.

Stage 2 — Identify the continuity mechanism

Ask what preserves dominance:

• data;
• contracts;
• ecosystem;
• interoperability;
• switching costs;
• IP;
• distribution;
• network effects.

Stage 3 — Measure competitive displacement

Determine whether a rival can realistically:

• enter;
• scale;
• attract users;
• access data;
• interoperate;
• obtain distribution.

Stage 4 — Examine cumulative effects

Look at conduct over several years rather than isolated transactions.

Stage 5 — Examine adjacent markets

Determine whether dominance is transferred into:

• complementary products;
• downstream services;
• upstream infrastructure;
• emerging technologies.

Stage 6 — Monitor future competitive constraints

Authorities should examine potential challengers before they become established competitors.

Stage 7 — Select proportionate remedies

Possible remedies include:

• interoperability;
• data portability;
• access obligations;
• non-discrimination;
• transparency;
• restrictions on self-preferencing;
• behavioural commitments;
• structural remedies in appropriate cases.

20. Ex Ante and Ex Post Oversight

A future system is likely to require both.

Ex post competition law

Acts after potentially harmful conduct occurs.

Examples:

• abuse-of-dominance proceedings;
• exclusionary conduct investigations;
• merger challenges.

Ex ante regulation

Creates continuing obligations before exclusionary conduct becomes entrenched.

The DMA represents this broader approach. In July 2026, the Commission adopted binding measures concerning Google's Android interoperability and sharing of search data, illustrating how continuing regulatory supervision can address structural advantages rather than waiting for a conventional infringement proceeding to establish all effects.

21. Continuity-Based Dominance and Merger Control

Merger control becomes particularly important when an incumbent acquires a firm that could become a future challenger.

The analysis should consider:

1. Is the target an emerging competitor?
2. Does it possess strategically important data?
3. Does it have a different technology?
4. Could it disrupt the incumbent's ecosystem?
5. Would the acquisition eliminate an independent competitive trajectory?
6. Does the transaction increase switching costs?
7. Does it expand control over an important interface?

The US DOJ merger guidelines expressly recognise the relevance of durability, entry, investment, innovation and competitive disruption in merger analysis.

22. Competition Authorities as Continuous Market Monitors

Future competition authorities may increasingly move from:

periodic investigation

toward:

continuous market intelligence.

Potential tools include:

• market monitoring;
• algorithmic auditing;
• interoperability testing;
• switching-cost measurement;
• ecosystem mapping;
• data-access analysis;
• technical benchmarking;
• merger pipeline monitoring;
• monitoring of emerging challengers.

This does not mean every dominant firm should be permanently treated as an offender. Rather, the purpose is to identify structural mechanisms capable of making competition progressively less contestable.

23. Key Legal Tests for Future Oversight

A useful continuity-based analytical test could ask:

Test 1 — Persistence

Has market power remained unusually durable?

Test 2 — Mechanism

What explains that persistence?

Test 3 — Accumulation

Does existing dominance generate additional competitive advantages?

Test 4 — Replicability

Can rivals reproduce those advantages?

Test 5 — Contestability

Can consumers realistically switch?

Test 6 — Displacement

Can an efficient new entrant reach sufficient scale?

Test 7 — Leveraging

Is dominance being transferred into adjacent markets?

Test 8 — Innovation

Does the structure reduce incentives or opportunities for technological displacement?

24. Important Limits

Continuity alone does not establish an antitrust violation.

A firm may remain dominant because it:

• innovates successfully;
• offers better products;
• achieves economies of scale;
• has legitimate network effects;
• earns consumer loyalty;
• invests efficiently;
• develops superior technology.

Competition law must therefore distinguish between:

durable dominance resulting from competition on the merits

and

durability produced or protected through unlawful exclusionary mechanisms.

This distinction is particularly important because antitrust law generally does not impose a universal obligation upon dominant firms to assist competitors. Trinko provides an important constraint on expansive theories of compulsory dealing.

25. Future Challenges

A. Measuring time

Authorities must decide how long a market should be observed before concluding that dominance is structurally persistent.

B. Predicting innovation

Future competition can be difficult to identify because the next challenger may not yet exist.

C. Avoiding false positives

Successful innovation should not automatically be characterised as exclusion.

D. Data asymmetry

Authorities may lack access to proprietary data necessary to understand ecosystem dynamics.

E. AI opacity

AI systems may change rapidly, making conventional market definitions unstable.

F. Cross-market effects

Dominance can migrate between markets, making narrow market analysis potentially incomplete.

G. Global ecosystems

Digital platforms often operate across jurisdictions, requiring coordination among competition authorities.

26. Conceptual Model

Current Dominance
↓
Network / Data / Infrastructure Advantage
↓
Higher Switching Costs
↓
Reduced Rival Scale
↓
Lower Competitive Pressure
↓
Further Investment & Data Accumulation
↓
Expansion into Adjacent Markets
↓
Ecosystem Reinforcement
↓
Persistent Dominance
↓
Potential Reduction in Contestability

The competition-law task is to determine which links in this chain arise from legitimate competitive success and which, if any, result from unlawful conduct or anticompetitive transactions.

27. Conclusion

Continuity-based dominance represents the temporal dimension of modern market power. Its central concern is not simply that an undertaking is dominant today, but that its present advantages may continuously reproduce the conditions necessary for dominance tomorrow.

The lessons from Microsoft, Aspen Skiing, Trinko, Kodak, Intel, Google Android and Google Shopping demonstrate different mechanisms through which established market positions can interact with distribution, access, switching costs, interoperability and emerging competition.

Future competition oversight is therefore likely to place greater emphasis on:

• durability of market power;
• ecosystem effects;
• data accumulation;
• network effects;
• interoperability;
• switching costs;
• emerging competitors;
• innovation and technological displacement;
• long-term merger effects; and
• continuous monitoring of structurally important markets.

The emerging regulatory direction is already visible in digital markets: the EU's DMA combines gatekeeper obligations with continuing regulatory specification, while the Commission's 2026 measures concerning Android interoperability and search-data access illustrate intervention aimed at preserving future competitive opportunities rather than considering only a single historical act.

Accordingly, the future of competition law concerning continuity-based dominance is likely to move from a predominantly static question — "Is this undertaking dominant?" — toward a more dynamic question — "What mechanisms make its market power persist, expand, and resist competitive displacement over time?"