1. Dr. Panayiotis Agisilaou Trojan Economics & Open University of Cyprus
Big data: Interaction between data protection rules and competition law and the implications for retailers 2nd Data Forum,
Dr. Panayiotis Agisilaou
Trojan Economics &
Open University of Cyprus

2. big data Collection of data is not a new phenomenon
Increasingly important role of data in shaping digital markets
devising commercial strategies
data-driven business models
Big data  often characterized by 5 “V”s
Volume
Velocity
Variety
Veracity
Value

3. Pro-competitive effects
Growing sales (e.g., targeted advertising and special offers)
Better customer analysis (e.g., demand needs and trends)
Personalized products / services (e.g., personalized recommendations)
Product improvement and development (e.g., identify market gaps, rectify faults/errors, improvement of algorithms)
Businesses process improvement (e.g., prompt adjustments to demand trends, simplification of transactions)
Free services (e.g., accounts, social media, apps on mobile devices, search engines)

4. Product/service quality
Potential concerns
Customers
Customers’ data
Product/service quality
Barrier to entry / expansion
Source of market power
Can drive network effects  amplify data / quality gap
Winner-takes-all outcome  higher market concentration

5. Data-driven theories of harm
Refusal to access to data
Essential input for other firms’ activities
Non-replicable and non-accessible from other sources
Discrimination (e.g., refusal to access to certain competitors)
Discretionary access
Amazon case (ongoing investigation by EC)
Exclusive contracts with third-party providers of data (i.e., exclusive licensing)
Google AdSense case (ongoing investigation by EC)

6. Data-driven theories of harm
Price discrimination
Better understanding of consumers’ willingness to pay  apply different prices to different consumers / groups of consumers
Negative impact on competition / consumers’ welfare depending on
search cost
switching cost
proportion of naïve (i.e., less price-sensitive to prices) / sophisticated consumers
behavioral biases (e.g., consumers’ ignorance)

7. Data-driven theories of harm
Tying
Leverage of market power to a related / neighboring market
Google Android case
Google Search app and Google Chrome browser were tied to Google play app
Status quo bias  users more likely to stick to pre-installed apps

8. Data-driven theories of harm
Algorithmic collusion
Increased market transparency
Facilitates establishment of collusion
Firms can more easily reach an agreement (i.e., price, profit sharing) by avoiding costly experimentation in the market
Enhances sustainability of collusion
Makes detection and retaliation of defections easier / faster (e.g., real time)
Enables algorithmic collusion
Coordinate and monitor prices of large number of firms
Removes uncertainty (i.e., identify intentional deviations and market related adjustments)
Integrate price-fixing mechanisms to data-based algorithms (i.e., sophisticated machine learning)

9. Data-driven theories of harm
Data protection and privacy as a non-competition parameter
Asnef – Equifax (CJEU, 2006)
“… any possible issues relating to the sensitivity of personal data are not, as such, a matter of competition law, they may be resolved on the basis of the relevant provisions governing data protection”
Competition law is relevant when privacy is an important parameter of non- price competition  quality parameter of a product / service (i.e., firms compete with regard to the strength of privacy protection)
Close link between dominant position, data collection and competition
Facebook (02/2019)

10. FINAL REMARKS Big data play a critical role in digital economy
Benign effects (e.g., increase innovation, quality improvement)
Source of market power / facilitate maintenance and reinforcement of market power (e.g., barriers to entry, network effects)
 Data-driven abusive strategies (e.g., refusal to access, price discrimination, tying, algorithmic collusion, quality degradation)
Competition law enforcement more likely when
Big data impacts on the competitive dynamics
Privacy protection has non-price effects

11. Thank You For Your Attention