This article is a part of the Perspectives on Industrial Policy symposium.
Antitrust policy in the United States generally doesn’t experience immediate dramatic revision with each new administration, and it’s unlikely that this time will be different. With that said, I would hope that the new administration will take a close look at recent enforcement policy, particularly regarding “Big Tech,” where there’s a concerning trend toward what I term “negative industrial policy.” This approach—which I’ve observed throughout my tenure as general counsel at IBM, Apple, and Qualcomm—risks undermining U.S. competitiveness on the global stage.
The resurgence of the “big is bad” mentality in antitrust enforcement harks back to an era when political considerations superseded economic analysis. This shift away from the consumer-welfare model and toward a more interventionist approach poses significant risks to American innovation and global leadership.
Historical precedents illustrate the unintended consequences of overzealous antitrust enforcement. The breakup of AT&T in 1982, while producing short-term increases in local competition, led to the demise of Bell Labs and the loss of U.S. leadership in telephone and infrastructure markets to foreign competitors. On the same day the breakup was announced, the U.S. Justice Department’s (DOJ) 13-year pursuit of IBM—which had been enormously costly in money, time, and lost innovation opportunities—was dismissed as “without merit.”
In contrast, countries like China and South Korea have leveraged their antitrust regimes to advance national champions and protect domestic industries. China’s anti-monopoly law (AML) is often wielded as a tool of industrial policy, rather than a means of ensuring fair competition. For instance, China’s National Development and Reform Commission (NDRC) has required foreign owners of intellectual property to set royalty rates below market value, effectively devaluing their R&D investments.
China’s merger-control regime provides another powerful lever for exercising both domestic and global industrial policy. The failed Qualcomm-NXP merger serves as a prime example, demonstrating how a single country’s antitrust regime can dramatically affect global industry dynamics.
South Korea’s chaebols—large, family-owned business conglomerates—have historically wielded significant influence over government policy, resulting in antitrust enforcement that aligns more closely with industrial-policy goals than with principles of fair competition. During my tenure at Qualcomm, we faced challenges from the Korean Fair Trade Commission (KFTC), where competitors like Samsung leveraged the KFTC to advance their commercial interests under the guise of antitrust concerns.
This instrumentalization of antitrust agencies by competitors is a growing concern, observed not only in Korea and China, but also in the United States. The Apple-instigated Federal Trade Commission (FTC) action against Qualcomm is a prime example. We must question when the legitimate use of a company’s right to register concerns about a competitor crosses the line into manipulating regulatory agencies for commercial self-interest.
The lack of procedural fairness and transparency in some of these antitrust prosecutions is particularly troubling—especially in China, where government agencies and the Chinese Communist Party (CCP) directly influence antitrust proceedings.
These international examples highlight a crucial point: antitrust enforcement doesn’t happen in a vacuum. It’s intimately tied to a country’s broader industrial-policy goals. While the United States shouldn’t blindly emulate China’s approach of actively favoring domestic companies, we also can’t afford to actively harm our own industries through misguided antitrust policies.
Our focus on “bigness” and the rejection of the consumer-welfare model in antitrust enforcement risks putting U.S. companies at a significant disadvantage in global markets. If we favor inefficient competitors over innovative leaders, we’re effectively handicapping our own companies in the face of fierce international competition.
Furthermore, the forced transfer of proprietary intellectual property, often a result of antitrust settlements, has historically benefited foreign competitors at the expense of U.S. innovators. In an era of intense technological competition, particularly in fields like 5G and AI, such outcomes are deeply problematic for U.S. interests.
So, what’s the path forward? We need a more nuanced approach that recognizes the global competitive landscape. Our antitrust policy should not be formed in isolation, but should consider how it interacts with the industrial policies of other nations. The United States should adopt a balanced approach that promotes fair competition, while also supporting the growth and innovation of domestic industries.
We should reassess our understanding of intellectual-property rights in the context of antitrust enforcement. The current trend of devaluing IP through antitrust action not only disadvantages U.S. companies, but also disincentivizes the very innovation we seek to promote.
Moreover, we need to be vigilant about the instrumentalization of antitrust agencies by competitors. Regulatory bodies should have robust mechanisms in place to distinguish between legitimate antitrust concerns and attempts to manipulate the system for commercial gain.
As we navigate the complex intersection of antitrust and industrial policy, we must ensure that our approach promotes rather than hinders U.S. competitiveness. This requires a delicate balance between addressing legitimate antitrust concerns and fostering an environment that allows American companies to innovate and compete effectively on the global stage.
While we shouldn’t adopt the protectionist policies of our other countries, we must also avoid self-inflicted wounds through overzealous antitrust enforcement. Only through such a balanced approach can we hope to maintain our technological leadership and economic strength in an increasingly competitive global landscape.
