Using APIs to Improve Competition
Application Programming Interfaces (APIs) are the hidden infrastructure of the modern internet. They allow developers and businesses to interact with software programmatically—accessing data, updating records, and performing actions without using a traditional graphical user interface. In effect, APIs define what is possible within a digital product.
In online marketplaces, APIs play a far more consequential role than simple technical integration. They determine whether platforms can interoperate, whether data can move freely, and ultimately whether meaningful competition can exist. When API access is open and fairly governed, markets remain contestable. When it is restricted, dominant platforms can entrench their position by locking competitors out of the very data required to compete.
This article explores how a targeted evolution of competition law—focused specifically on mandatory API access and database portability—could address one of the most persistent barriers to entry in digital markets: database dominance. Using Booking-com as an illustrative example, the article demonstrates how early movers often retain control not through superior service, but by owning the most complete dataset. Crucially, the same structural problem—and solution—applies across a wide range of online marketplaces.
By reframing APIs as regulated market infrastructure rather than discretionary product features, policymakers have an opportunity to unlock competition, reduce vendor lock-in, and create a more open and resilient digital economy—without penalising innovation or success.
Problem: The Database Barrier:
In the digital marketplace, early innovators often gain a significant competitive edge by amassing the most comprehensive database. This creates a self-reinforcing cycle: as they attract more buyers and sellers, their data advantage strengthens, making it increasingly difficult for new entrants to compete.
Take Booking-com for example. As one of the first major online hotel booking marketplaces, it rapidly built the most extensive hotel database, securing its position as the dominant player. This dominance creates a chicken-and-egg problem for competitors of the market leader:
Customers want to book where the most hotels are available.
Hotels want to list on platforms with the most customers.
New competitors struggle to break in because they lack this database to attract either group.
This results in a closed-loop market, where the early innovator maintains control, not necessarily through better service, but because they own the most complete database.
What makes Booking-com so effective is that it lists significantly more hotels than any competing marketplace. The platform is so comprehensive that many users rely on it exclusively when planning holidays. As a result, users often fail to distinguish between the product (the hotel) and the service (the marketplace), which makes the overall experience feel markedly superior to that of competitors operating in the same space.
Solution: A Minor Adjustment to Anti-Competitive Law:
Existing anti-competitive laws often fail to address database dominance as a barrier to entry for new competitors, but a minor regulatory shift will level the playing field, thereby increasing fair competition.
Trigger for Regulation:
If an online marketplace reaches a certain percentage of market revenue (e.g. 40% market share), sellers (companies) on that platform will be required by competitive law to obtain three quotations when selling their products and services online. (For example, Hotel owners).
This regulation targets the sellers on the marketplace, rather than the marketplace itself.
The principle mirrors existing government procurement processes, which require multiple quotes before making a purchase to prevent monopolistic pricing and promote efficiency.
Using Booking-com as an example: hotels often list their properties exclusively on Booking-com. Under this rule, they would now be required to also list on at least two other competitor marketplaces (e.g. European hotel platforms like Viatu, TravelPerk, or Momondo). This would result in competitors having nearly identical product catalogues.
This ensures that buyers (hotel guests) can rent the same property from multiple platforms, allowing them to compare prices and service. It also gives buyers the freedom to choose a local provider if they prefer.
How the Software Aggregator Works:
When the law comes into effect, it will introduce operational challenges for sellers on digital marketplaces. For example, hotel owners may be required to list their properties across multiple booking platforms. Any subsequent change to a listing—such as pricing, availability, or descriptions—would then need to be replicated across several marketplaces, significantly increasing administrative overhead.
The most effective solution to this problem is the use of listing aggregation software. These tools integrate with the APIs of multiple competitor marketplaces and allow sellers to manage all listings through a single, unified interface.
To ensure this model functions fairly, regulatory support will be required in the form of mandatory API access. This would prevent dominant platforms—such as Booking-com, or market leaders in other sectors—from restricting or blocking API access to suppress competition. While many platforms currently offer API access, market leaders may choose to limit or withdraw it if increased competition threatens their position.
Over time, multiple technology providers will likely develop similar aggregation tools, enabling listings to be synchronised automatically across marketplaces. Changes made on one platform would propagate to others via their respective APIs, reducing duplication, improving accuracy, and restoring competitive balance across digital marketplaces.
One-click listing: Hotels input their hotel room once, and the software automatically distributes the listing to a market leader platform, and at least two competitor platforms.
Unified dashboard: Hotels manage their listings, prices, and availability from a single interface—no need to log into multiple marketplaces.
Sales Manager: A list of aggregate sales from competitor marketplaces, as well as sales by platform.
Price adjustments: Marketplaces can adjust commissions to compete on price.
Centralised communication: All customer emails from different platforms are managed in one inbox, with labels distinguishing the source marketplace.
The market leader typically becomes the industry-standard template that listing software uses to synchronise changes across competing marketplaces. In most cases, competitor platforms already share broadly similar data structures, meaning implementation is largely a matter of mapping equivalent data fields through API integrations.
The key distinction is that this approach consolidates management into a single interface for all marketplaces, eliminating the need to log in to multiple platforms individually to make updates.
Product Reviews Aggregation:
An extended option is for the software to collect and aggregate buyer reviews to display an average from all marketplaces for a specific product or service (such as a hotel). This would serve as a unified product review, distinct from the individual review scores sold by each marketplace.
So, web users would become accustomed to seeing two types of reviews, one for the product itself and the other for the marketplace. This will help buyers differentiate between the product and the service in their purchasing decision.
Such data aggregation would give buyers greater choice and help create a level playing field, making it easier for competitors to enter the market and gain market share.
Additional Benefits: Direct Sales & Upselling Opportunities
The same listing software could also serve as a direct booking engine for hotel websites, allowing hotels to bypass online marketplaces entirely for direct customer sales.
There could be another section that amalgamates car rental databases on their website to increase cross-sell.
Balancing Innovation with Fair Competition
The goal is not to punish early innovators—they should be rewarded for their vision and execution. However, at a certain threshold, regulation should shift the balance from protecting the innovator to protecting the market itself.
Early innovators should enjoy the first-mover advantage and brand recognition they’ve built.
Once dominance is reached, structural safeguards should prevent them from using their database monopoly to close down competition indefinitely.
Competitor marketplaces will have the same catalogues—or very similar ones—giving buyers the freedom to choose based on service
A More Open and Competitive Internet
This minor policy shift breaks down artificial barriers to the best database, allowing innovation to thrive while ensuring fair competition. It gives competitor marketplaces a fighting chance, benefits sellers with greater flexibility, and ensures customers have real choices—leading to a more dynamic, open digital marketplace. Although Booking-com is used here as an illustration, the principle is transferable to various online marketplaces, provided it is tailored to the relevant industry and context.
Summary:
Digital marketplaces rarely become dominant because they offer inherently superior services. More often, they win because they were first to accumulate the most complete database. Once that threshold is crossed, network effects take over: buyers go where the listings are, sellers go where the buyers are, and competitors are structurally locked out. Over time, the marketplace becomes indistinguishable from the market itself.
The case of Booking-com illustrates this dynamic clearly. Its dominance is not the result of exclusive technology, but of catalogue breadth. When users associate the quality of the hotel stay with the quality of the marketplace, competition effectively collapses—even if rival platforms offer comparable or better service.
A light-touch regulatory adjustment focused on mandatory API access and listing portability provides a pragmatic solution. By requiring sellers on dominant platforms to distribute listings across multiple marketplaces—and by ensuring that APIs cannot be withdrawn to suppress competition—the database monopoly is neutralised without dismantling the market leader itself. Sellers gain flexibility, competitors gain viable catalogues, and buyers regain genuine choice.
Crucially, this approach does not punish early innovation. First movers retain their brand recognition, scale advantages, and operational expertise. What changes is their ability to convert database dominance into permanent market closure. Once a platform reaches systemic importance, the priority shifts from protecting the innovator to protecting the market.
The result is a more open and resilient digital economy: one where platforms compete on service quality, pricing, and innovation rather than exclusive access to data. While online travel provides a clear example, the same principles apply to e-commerce, recruitment, property portals, food delivery, and other database-driven marketplaces.
By treating APIs as regulated market infrastructure rather than discretionary product features, policymakers can lower barriers to entry, reduce vendor lock-in, and restore competition—without undermining the incentives that drive innovation in the first place
