Impact of innovation on competition law: From the perspective of ad-blocking applications

Innovation was traditionally protected for its outcome in particular under intellectual property laws. However, this approach has gradually reached its limit when more innovation needs to be stimulated. Antitrust law has thus developed a 'process-oriented' protection, despite the fact that such a new approach slightly intrudes on the exclusivity of property rights. However, less has been discussed so far on how anti-unfair competition law has been affected by innovation. Anti-unfair competition law targets conduct that dishonestly takes advantage of other competitors, thus traditionally having its core analytical framework built upon tort law. While the 'outcome-oriented' approach is still satisfactory from many perspectives, its drawbacks have been extensively revealed with the recent challenge of ad-blocking applications. At first sight, the traditional approach may be justified. However, closer examination unfolds the risk of stifling innovation. Therefore, this article advances a new economic interpretation on the business model of online media operation, the target of ad-blocking applications, namely the 'combined sale' model vis-à-vis the traditional 'single product' model. It is finally concluded that the process-oriented approach should prevail over the traditional outcome oriented approach where the combined sale model is involved.