Market Definition and Free Online Services: The Prospect of Personal Data as Price

Posted by Social Science Research Network

Market Definition and Free Online Services: The Prospect of Personal Data as Price

By Magali Eben (University of Leeds)

Abstract:     When online services are offered for ‘free’ to a group of users, the traditional price-based tools of market definition. If there is no price, there can be no market. This paper aims to address this problem through a thought experiment: what if the ‘price’ paid by users is not money, but personal data. If users approach personal data as a medium of exchange, their sensitivity to increased demands of personal data could be used to measure demand-side substitutability. In that case, personal data may be incorporated as the price in the SSNIP test. This article establishes the first steps in this thought experiment, acknowledging both its limitations and its potential.

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