Should Antitrust Regulators Stop Companies from Collecting So Much Data?

Posted by Harvard Business Review

Should Antitrust Regulators Stop Companies from Collecting So Much Data?

By Joe Kennedy

Innovation has always required a constant iteration of trial and error as companies use data about current performance to improve future performance. So it should come as no surprise that companies in the information age want to use ever more data to hone their products. But there is an emerging debate over the competitive implications of big data. Some observers argue that companies amassing too much data might inhibit competition, so antitrust regulators should preemptively take action to cut “big data” down to “medium data.” Others say there is nothing new here, and existing competition law is more than capable of dealing with any problems.

Among those advocating for an expansion of antitrust reviews around data are law professor Maurice Stucke and antitrust attorney Allen Grunes, who voice three interrelated concerns in Big Data and Competition Policy. First, they argue that allowing companies to control large amounts of data raises barriers to entry for potential rivals that lack enough data to develop competitive products. By this logic, deals like Facebook’s acquisition of WhatsApp should be fought, because allowing a dominant company to acquire even more data will increase its market power.

Second, proponents of this view assert that existing antitrust law is inadequate for the competitive threats stemming from large collectio…

ACCESS TO THIS ARTICLE IS RESTRICTED TO SUBSCRIBERS

Please sign in or join us
to access premium content!