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.
Should Antitrust Regulators Stop Companies from Collecting So Much Data?
The case for and against.
April 17, 2017
Summary.
Some observers argue that amassing too much data might inhibit competition, so antitrust regulators should preemptively take action. But other antitrust scholars are much less worried that possessing large amounts of data automatically confers market power. For example, economists Anja Lambrecht and Catherine Tucker recently examined the use of data and found “little evidence that the mere possession of big data is sufficient protection for an incumbent against a superior product offering.” Indeed, data-rich companies are not an economic threat, but an important source of innovation. If the simple possession of data were to become a new factor in antitrust analysis, it would depress innovation when policymakers should instead be encouraging it.