Big Data Competition Considerations - PowerPoint Presentation

Slide1

Big Data

Competition Considerations

Data important to business model in certain sectors

“Gigantic datasets … extensively

analysed

using computer algorithms”*

What is Big Data?

Big Data growing rapidly:

McAfee: companies that make the most of their data are 5% more productive and 6% more profitable than their competitors

IDC: big data will generate $125 billion in 2015; will grow worldwide at

CAGR

of 40% (about seven times that of the ICT sector overall)

but let’s be considered in assessing potential harm

* Article 29 Working Party, Opinion 2013

Transform

Europe's service industries by generating a

range

of innovative information products and

services

Increase productivity

of

the economy through improved business intelligenceHelp to address many challengesE.g., Environmental, cybersecurity, traffic managementImprove research and speed up innovationE.g., health and epidemiological researchReduce costs through personalized servicesIncrease efficiency in the public sectorMcKinsey: possible savings of up to €300 billion a year in the EU

Advantages of Big Data

Competition Law and Big

Data

Fundamental question – what is ‘big data’?Not only personal data; also includes aggregated and anonymised data setsUsed as an input in many industries (not only GAFA)Online advertising – used to target adsFMCG (incl loyalty schemes) – inventory management and targeting adsTravel and local (

incl user reviews and frequent flyer schemes) – load/inventory managementeMedicine and other eServices - personalisation and real-time management of patientsSearch data – used to improve tail query results

Nature of the data is importantNot a new phenomenon

V

olume of data generated and analysed is new, as are some uses

Data is an “input

” – nothing about it warrants departure from normal application of competition rules

DG COMP has considered data as an input in a number of cases, most recently, Facebook/WhatsAppData increasingly used to monetise multi-sided online markets (where one side is “free” and another pays), such that the data is critical to both sides:On consumer side – improves relevance/ quality of service (attracting and retaining users)On merchant/advertiser side – delivers targeted advertising/offers (attracting advertisers)Consumers (on “free” side) can provide data directly (e.g., in user profiles) or indirectly (e.g., what they view/listen to, where they go)

One data set can be used in multiple marketsCompetition Law and Big Data

Like other inputs there are key

threshold questions to imposing an obligation to share data

(Bronner framework, essentially):ReplicabilityUser multi-homingMultiple layers in stack have/access same data Exclusivity Degree to which data is important to competing in a downstream/related marketAssess each type of data in context of market in issue – need to understand how each market functions, parameters of competition, sources of data and market positions of entity(ies) to determine potential for competitive harm

Competition Law and Big Data

Competition concerns

may arise

Exclusive access to data used to raise rivals’ costs or otherwise disadvantage rivals (preventing entry and expansion)Reviewed in Google/Doubleclick, M-commerce, Publicis/OmnicomPotential network effects – where entity has market power that enables control over further data collection, incentives (and ability) to exploit existing power might increaseReviewed in Google/

Doubleclick, Facebook/WhatsAppPotential cross-platform network effects – e.g., advertising and user services

Under consideration in Google searchPotential scale effects –

e.g.

, tail

search queriesUnder consideration in Google searchCompetition Law and Big Data