Regulation of digital platform ecosystems: Evidence from Russia's Google vs Yandex ruling

Policy-makers' regulation of digital innovation platforms is widely debated. Of particular interest is the potentially anticompetitive behavior of platform owners toward complementors. Yet, our understanding of the effectiveness and mechanisms of regulating competition in platforms is only marginally understood. To address this gap, we study the consequences of the settlement between Google and the Russian Antimonopoly Service FAS concerning the Android platform. The settlement forced Google to give up its practice of forcing device makers to pre-install Google's own apps. We exploit this unique setting as a quasi-experiment and compare innovation in apps affected by the settlement with innovation in apps not affected by the settlement. Our preliminary findings cannot confirm substantial innovation-enhancing effects of the regulation, but require further long-term analysis. We expect our study to have implications for understanding competition in platforms, the regulation of platforms, and the complex mechanisms in platform that shape innovation.