German competition watchdog wants 'big data' hoards considered in merger probes: paper
FRANKFURT.The vast troves of consumer data
held by big Internet companies should be scrutinized in merger
probes because they have a big impact on competition, the
president of the German antitrust watchdog told a newspaper.
"Until now, markets in which no money flows and in which no
revenues are posted do not count as markets from a
competition point of view. But that obviously goes against the
logic of many Internet markets," Andreas Mundt told
Sueddeutsche Zeitung's Saturday edition.
Collections of "big data" - covering billions of internet searches,
messages and other online interactions - hand Internet
companies huge power they can exercise in marketing and
commerce and which potentially makes it difficult for smaller
businesses to compete in those areas.
Facebook's FB.N $19 billion acquisition of Whatsapp in 2014
almost escaped scrutiny from cartel authorities as the
messaging service hardly had any revenues at the time, Mundt
said, adding that it was apparently still of great strategic
importance to Facebook.
"How many users are there and which data is concerned?
Those are the better measurement categories when it comes
to defining competition in the Internet," he said, adding that
lawmakers should clarify rules.
While the German cartel authority does take data issues into
account when making decisions, these may be successfully
challenged in court due to the lack of clear legislation, he
added.
The German competition watchdog has set up a six-person
Internet task force which is working on drafting plans on how
German law can be adapted to the Internet age, he said.
Mundt's comments come after the European Union also
started to take a harder look at whether the use of "big data"
by Internet companies violates competition rules.
Since taking over as Europe's top antitrust enforcer in 2014,
Margrethe Vestager has stepped up investigations into U.S. web
giants such as Google and Amazon to decide whether her
agency should regulate them more tightly.
"If just a few companies control the data you need to satisfy
customers and cut costs, then you can give them the power
to just drive rivals out of the market," Vestager said last
month. Last April, the European Commission accused Alphabet
Inc's (GOOGL.O ) Google of favoring its own shopping
services in search results at the expense of rivals, and is
weighing possible sanctions against the world's most popular
search engine. Previously, the EU considered and rejected big
data concerns when it approved Google's acquisition of online
advertising firm DoubleClick in 2008 and Facebook's purchase
of WhatsApp.
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