Antitrust Risks and Big Data

Abstract

The explosive growth in companies’ exploitation of big data is drawing intense scrutiny from European antitrust authorities. EU Competition Commissioner Margrethe Vestager has promised to “keep a close eye on how companies use data” and a number of European antitrust authorities have conducted full-blown studies on big data issues, including an especially comprehensive May 2016 Franco/German study on “Competition Law and data”. Antitrust authorities fear that big data can create barriers to entry and market power, especially where companies hold unique datasets that cannot be replicated by competitors. However, a closer look at big data-related theories of harm suggests that the focus on uniqueness may be misplaced. Many companies collect voluminous datasets that are unique and non-replicable, as well as, being valuable and competitively significant, without raising exclusionary concerns of the types highlighted by antitrust authorities. The perception that limited access to big data may create barriers to entry and stifle the growth of the digital economy risks provoking an overbroad legislative reaction. In January 2017, the EU Commission consulted on a wide range of data-related issues, proposing among other things that companies be required to share non-personal, machine-generated data with third parties, including competitors, whether or not the data-holder holds a dominant position or engages in abusive conduct. As such, it would go far beyond any access remedy recognized in the antitrust context. This article discusses European antitrust authorities’ concerns about the foreclosure risks of big data from the perspective of the different types and uses of big data. This approach reveals that exclusionary concerns arise in a relatively small segment of big data uses, and those situations can be assessed using traditional antitrust tools. Some important big data issues not addressed in this article include the mirror image of these exclusionary concerns – i.e., that ubiquitous big data can make markets so transparent that competition may be impaired by competitors using pricing algorithms – the role of big data in merger review, and the relationship between antitrust enforcement and data protection. Big data are a big topic, and a complex one.