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Bring Antitrust Action Against Google and Other Big Data Platforms

Given the lack of options for consumers in many online industry sectors where one or only a few companies dominate, depending on empowering consumers is only a limited tool.  As Julia Angwin notes, helping put a price on personal data only goes so far: “Before we had a minimum wage and limited work hours, people were willing to ‘sell’ their labor at extremely low prices for very long hours.”[i]

There is a strong argument that federal regulators should be looking at how to structure data platform sectors to both promote more competition and encourage more consumer power within those sectors.  Given the near-monopoly of certain platforms in search advertising and social networking, European regulators are already looking closely at the connection between industry concentration and the loss of consumer privacy. France’s economy minister Arnaud Montebourg has argued that regulators should be looking at tighter regulation, including potentially moving to “unbundling” companies like Google, for example by separating its search arm, mobile, YouTube and email services into separate companies.[ii]

State attorneys general could be approached (with the goal of enlisting the US FTC or Justice Department in the long term) to support an antitrust lawsuit against Google around its overall dominance of the search-advertising sector.  There is no exact equivalent in antitrust law precedent to Google’s control of user data but the fact that no potential competitor cannot obtain enough user data to be a threat to the company’s key search advertising market is analogous to other monopolists’ attempts to deny key inputs to rivals, from the denial of key metals to industrial concerns[iii] or, possibly of more relevance, to the illegal attempt by Microsoft to eliminate the nascent threat of Internet browsers to its operating system monopoly by choking off distribution by Netscape. As the D.C. Circuit argued in United States. v. Microsoft, courts can infer antitrust liability “when exclusionary conduct is aimed at producers of nascent competitive technologies as well as when it is aimed at producers of established substitutes.”[iv] Given the premium Cost Per Click (CPC) Google can charge advertisers because of its superiority in targeting users, combined with the fixed costs in maintaining such a multi-product platform to access this breadth of user data, it clear that Google will not face viable competition in the search advertising field without antitrust action by government agencies, especially given its relentless expansion into new sectors to expand its control of user data.

[i] Angwin, p. 216.

[ii] Juliette Garside, “From Google to Amazon: EU goes to war against power of US digital giants,” The Observer, July 5, 2014, http://www.theguardian.com/technology/2014/jul/06/google-amazon-europe-g...

[iii] See Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 693 (1962) (upholding a jury finding of antitrust liability by a company “attempting and conspiring to monopolize, trade and commerce in ferrovanadium and vanadium oxide,” a key input needed by plaintiff for its industrial production).

[iv] United States v. Microsoft Co., 253 F.3d 34, 79 (D.C. Cir. 2001).