Patrick Leblond at The Conversation: “…Traditional antitrust approaches such as breaking up Big Tech firms and preventing potential competitor acquisitions are never-ending processes. Even if you break them up and block their ability to acquire other, smaller tech firms, Big Tech will start growing again because of network effects and their data advantage.
And how do we know when a tech firm is big enough to ensure competitive markets? What are the size or scope thresholds for breaking up firms or blocking mergers and acquisitions?
A small startup acquired for millions of dollars can be worth billions of dollars for a Big Tech acquirer once integrated in its ecosystem. A series of small acquisitions can result in a dominant position in one area of the digital economy. Knowing this, competition/antitrust authorities would potentially have to examine every tech transaction, however small.
Not only would this be administratively costly or burdensome on resources, but it would also be difficult for government officials to assess with some precision (and therefore legitimacy), the likely future economic impact of an acquisition in a rapidly evolving technological environment.
Open data access, level the playing field
Given that mass data collection is at the core of Big Tech’s power as gatekeepers to customers, a key solution is to open up data access for other firms so that they can compete better.
Anonymized data (to protect an individual’s privacy rights) about people’s behaviour, interests, views, etc., should be made available for free to anyone wanting to pursue a commercial or non-commercial endeavour. Data about a firm’s operations or performance would, however, remain private.
Using an analogy from the finance world, Big Tech firms act as insider traders. Stock market insiders often possess insider (or private) information about companies that the public does not have. Such individuals then have an incentive to profit by buying or selling shares in those companies before the public becomes aware of the information.
Big Tech’s incentives are no different than stock market insiders. They trade on exclusively available private information (data) to generate extraordinary profits.
Continuing the finance analogy, financial securities regulators forbid the use of inside or non-publicly available information for personal benefit. Individuals found to illegally use such information are punished with jail time and fines.
They also require companies to publicly report relevant information that affects or could significantly affect their performance. Finally, they oblige insiders to publicly report when they buy and sell shares in a company in which they have access to privileged information.
Transposing stock market insider trading regulation to Big Tech implies that data access and use should be monitored under an independent regulatory body — call it a Data Market Authority. Such a body would be responsible for setting and enforcing principles, rules and standards of behaviour among individuals and organizations in the data-driven economy.
For example, a Data Market Authority would require firms to publicly report how they acquire and use personal data. It would prohibit personal data hoarding by ensuring that data is easily portable from one platform, network or marketplace to another. It would also prohibit the buying and selling of personal data as well as protect individuals’ privacy by imposing penalties on firms and individuals in cases of non-compliance.
Data openly and freely available under a strict regulatory environment would likely be a better way to tame Big Tech’s power than breaking them up and having antitrust authorities approving every acquisition that they wish to make….(More)”.