This paper examines the question of data as an essential facility. It argues that rather than size being the biggest driver of data meeting the definition of being an essential facility, it is instead whether the data are protected by copyright or privacy regulation.

Catherine Tucker1

I. ARE DATA AN ESSENTIAL FACILITY?

The notion of an “Essential facility” is key to antitrust law, because denial of access to key facilities can mean that a potential monopolist will be immune, at least for some time, to most forms of competition. As an economist, I observe that legal scholars debate whether anything can really be an essential facility, given that one can always raise exceptions or caveats to any even potentially watertight case.

Given this scholarly debate, it is useful to introduce terminology used for a parallel notion in strategic management. Here the focus is on a “resource” that gives “sustainable competitive advantage,” or that can act as a barrier to entry. The idea of such a “resource” was first articulated by my colleague Birger Wirnerfelt at MIT,2 and then further refined by Barney (1991).3 To be a “resource,” the asset in question needs to be valuable, non-imitable (or at least difficult to substitute), and rare. More recent the-ory has introduced the additional nuance that the firm must be able to “control” this rare, valuable, imperfectly imitable and non-substitutable resource.4

When we teach t

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