Opinion: Internet Platform Economy’s Health Relies on Good Governance

The recent discussions by the State Council on the platform economy have reiterated the importance of enhancing platform governance. This involves regulating market competition, protecting consumer and worker rights, and improving systems for complaints and evaluations. The platform economy needs to adapt to these demands to enhance its role in job creation and overall economic health. The emphasis is on safeguarding consumer and worker interests while boosting internal operations and quality, as any deviation could harm platform sustainability. [para. 1]

The platform economy, having surpassed its rapid growth phase, is now encountering developmental challenges such as intensified unfair competition and price wars. This necessitates robust internal and external governance systems on platforms. Platforms need a cooperative approach to governance, leveraging both legal and market mechanisms, and must transition from a passive to a proactive governance attitude. Effective platform governance is crucial for survival and thriving in the current economic landscape. [para. 2]

Regulating platform competition, particularly with low-price models, has become increasingly important, as it affects merchants' profitability and can lead to conflicts. Recent incidents, like Nongfu Spring founder Zhong Shanshan's criticism of livestreaming e-commerce, highlight broader industry frictions in the expanding platform economy. This showcases the necessity of precise platform governance to address these underlying tensions. [para. 3]

Defining governance boundaries is essential, especially concerning low-price competition. It's crucial to discern whether such competition abides by fair practices or exploits market dominance. Though consumers might benefit temporarily, unethical low-price strategies could damage the industry ecosystem. Explicit governance definitions ensure targeted and effective interventions that support the platform economy's healthy development. [para. 4]

The complex nature of platform governance requires consideration of challenges like addiction prevention associated with algorithm-driven content delivery. Algorithms, though neutral tools, can establish dominant positions or undermine governance goals if not properly managed. Authorities have initiated efforts to mitigate issues like "information cocoons" and data "price discrimination." However, globally and particularly in China, balancing algorithmic power in governance remains a formidable task. [para. 5]

Adopting a rule-of-law approach to internal platform governance is critical. Platform-related controversies often relate to legal violations, ethical breaches, or disruptions to public order. Misconduct, such as condoning defamation, transcends governance issues and may become legal concerns. Ensuring government oversight aligns with legal frameworks is paramount, as recent laws establish a growing regulatory base requiring further implementation. [para. 6]

Labor rights in burgeoning industries, such as ride-hailing and delivery services, demand urgent attention. Despite potentially high earnings, workers remain vulnerable due to platforms' power dynamics. The phrase “trapped in the system” underscores this issue's intensity. Effective platform governance must focus on safeguarding workers' legitimate rights and ensuring they have channels for expression and advocacy. [para. 7]

Ultimately, platform governance aims to foster sustainable growth in the platform economy, helping it remain dynamic and flourishing. The State Council stressed that the platform economy is vital for expanding domestic demand, employment stability, and enhancing societal welfare. Policies need to continuously advance positive aspects of the platform economy to maintain its pivotal economic functions. [para. 8]