US antitrust enforcers moved too slow to address anticompetitive conduct during the last major evolutionary phase of the internet and should remain mindful of exclusionary conduct that curbs incentives to innovate, a senior US Department of Justice official said Tuesday.
US antitrust enforcers moved too slow to address anticompetitive conduct during the last major evolutionary phase of the internet and should remain mindful of exclusionary conduct that curbs incentives to innovate, a senior US Department of Justice official said Tuesday.“I've worked for the [DOJ's Antitrust Division] for 10 years, and there's a pretty wide consensus that we probably waited too long in the United States in Web 2.0,” (see here) said David Lawrence, the division’s policy director, while speaking in a personal capacity at an event* focused on AI.
“Web 2.0” generally refers to a prior era of internet usage that revolved around user-generated content, virtual communities and interoperability.
“How much faster do we need to be here? I don't think that answer is: ‘We need to be careful,’” Lawrence said.
US Federal Trade Commissioner Mark Meador outlined during a conference** on Monday how the speed of technological change can amplify competitive harm while addressing a common claim about digital markets: “the pace of innovation makes antitrust enforcement not just difficult, but counterproductive.”
“This critique has some force as an argument for equipping agencies with more funding and considering proposals that would address evidentiary challenges that impede more efficient enforcement,” Meador said. “What it does not support is abdicating an obligation to enforce the law.”
Lawrence highlighted the importance of considering how barriers to entry from exclusionary conduct and regulations can affect incentives to innovation for different market players.
— Innovation —
A “huge lesson” from Web 2.0, Lawrence said, is that “We really need to be looking at whose innovation do we want to incentivize in this industry — usually everyone — and where are there going to be barriers that decrease that ROI?”
Epic Games, other private plaintiffs and state attorneys general have brought antitrust litigation against both Google and Apple, who for many years charged a 30 percent commission through app stores that facilitated app sales and in-app purchases of digital goods.
“[A] 30 percent take on every app ever developed in Web 2.0 ... there is no question that that reduced the overall innovation incentives of people toward app development,” the policy director said. “You just can't argue about that.”
Across the globe, the tech giants’ app distribution businesses have also faced antitrust lawsuits from Epic and broader antitrust scrutiny from competition agencies (see here and here).
“When companies engage in exclusionary conduct, what is that doing to the investment incentives of third parties who are going to be working with them in the future?” Lawrence said. “Exclusionary barriers to entry, the ones who violate the antitrust law, they sort of definitionally increase the cost of getting into that market.”
But the veteran DOJ official noted that regulation can also decrease innovation incentives for firms building a better mousetrap. “So I do think context really matters.”
In 2025, the DOJ and FTC asked government agencies to identify anticompetitive regulations, with FTC Chairman Andrew Ferguson providing the White House’s Office of Management and Budget with a list of rules he recommended for revision or deletion (see here and here).
Dynamic competition is not “just about static incentives,” Lawrence said. “It’s not about the price of the plane tomorrow... It’s, ‘Why did the airline buy the plane and put it on that route?’ That’s what’s actually most important to competition in many of these markets.”
Innovation is often invoked during debates about whether antitrust intervention into fast-moving markets is appropriate, Meador said, “but too frequently as a vague, all-purpose defense, rather than a concrete economic consideration.”
Breakthroughs in one area of business don’t excuse practices that foreclose access to alternatives in another part of their business, according to Meador.
“Innovation matters, but only insofar as evidence can be put forward that the challenged conduct itself is the driving force behind that innovation,” the FTC commissioner said.
— Multi-homing —
During a panel discussion about consumers’ use of multiple AI chatbot tools — an example of the phenomenon known as multi-homing — Lawrence described how stronger AI firms may also face incentives to shut down multi-homing capabilities during the race toward leading the market.
“I actually sometimes have Claude go ask Gemini to do research ... because it has access to more of the internet,” he said. “But Claude is way better at checking if there are hallucinations.”
“That could just turn off tomorrow, right? Things like that, I think, start to be something we should be pretty mindful of,” Lawrence said.
*GCR Live: AI in Transforming Markets, organized by Global Competition Review, Washington, DC, March 24, 2026.
**“The Washington Antitrust and Digital Markets Forum," organized by MLex, George Washington University Competition Law Center, Forum Global, Washington, DC, March 23, 2026.
Please email editors@mlex.com to contact the editorial staff regarding this story, or to submit the names of lawyers and advisers.