EU competition commish: We 'pay' for search and social media – with our data
But don't think I'm not watching you, data-slurper tech firms...
Speaking at a digital innovation conference in Munich on Sunday, the European Union's competition commissioner warned of her interest in internet companies' big data slurpage.
Just over a year into the role, Margrethe Vestager has acquired a reputation for knuckling down on the operations of large technology corporations, having begun investigations into Apple’s tax practices in Ireland, and having brought antitrust charges against Google last April. In November last year, she warned Google's parent company, Alphabet, that it could face more competition charges in Brussels.
The Dane declined to introduce herself at the beginning of her speech, instead noting she didn't need to “because you have all that information to hand. You can do a web search or look through my Twitter feed to find out almost everything you need to know about me.”
"These incredible powerful tools, like search engines and social media, are available for free. In many cases, that's because we as consumers have a new currency that we can use to pay for them – our data."
This constitutes a business transaction, according to Vestager – and, as such, consumers have a right to be treated fairly.
"If a company's use of data is so bad for competition that it outweighs the benefits, we may have to step in to restore a level playing field," warned Vestager, before adding that "we shouldn't take action just because a company holds a lot of data. After all, data doesn't automatically equal power."
Measuring the value of data is difficult. Vestager stated that a strong market position isn't guaranteed by the quantity of data a company may hold, if that data is out of date for instance. She added that her commission needed to ask whether competitors could acquire "equally good information."
Lawyers for large technology firms in the US have criticised Vestager for being misguided regarding competition issues, says Vestager, who added her commission is sensitive to such criticism and considers, in such cases, what, if anything, stops smaller companies "from collecting the same data from their customers, or buying it from a data analytics company".
Vestager's commission has made headway on such issues in two merger cases, when Google acquired DoubleClick, and Facebook's $19bn purchase of WhatsApp, criticised for slurping users' phone books.
Ultimately, in those cases Vestager said "there was no serious cause for concern. Because even after those mergers, other companies would have access to many sources of useful data."
The fear however is that a situation may develop through such mergers in which a few companies "control the data you need to satisfy customers and cut costs," which could give such companies "the power to drive their rivals out of the market."
What the EU's Competitions Commission needs to do is "is to pay close attention to these markets and take action when it's necessary," said Vestager.
"Competition rules can't solve every problem on their own." she added, "But they can make an important contribution to keeping digital markets level and open." ®
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