Mandatory access to digital platforms’ data is one of the remedies proposed to address potential failures in digital markets. In addition to the high costs of implementing a governance framework for data access, such remedy is likely to involve important trade-offs that should be carefully balanced by regulators. In particular, data access is likely to undermine competition on the merits and the incentives to offer services to consumers free of charge. Furthermore, it could distort companies’ incentives to innovate with user data. To avoid these unintended effects, this article proposes to focus instead on prohibiting exclusionary practices by large digital platforms.
By Jordi Casanova1
Brennan Hawkings, an 11-year-old boy from Utah, was found after being lost for more than four days in rugged terrain at a Boy Scout camp.2 Brennan’s parents later discovered why it had taken so long to find him: he had avoided passers-by, including the search teams looking for him. The boy was afraid that someone would steal him, as he’d been told “not to talk to strangers.”
Brennan’s case is a textbook example of the so-called Law of Unintended Consequences. Not talking to strangers is a universal lesson taught by well-intentioned parents to protect their children. In the context of Brennan’s disappearance, however, it had the unintended effect of leaving him unprotected.
This article discusses how data access regulation of online search aggregators may similar!-->…