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Data Portability: Antitrust and Privacy Critique

This article provides a critical analysis of the right to data portability (RDP) from both antitrust and privacy perspectives. It explores the potential impact on consumer welfare, the control over personal data, and the concerns regarding market power and data security. The article concludes with suggestions for a cautious approach and considering actual problems before implementing new regulations.

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Data Portability: Antitrust and Privacy Critique

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  1. “Why the Right to Data Portability Likely Reduces Consumer Welfare: Antitrust and Privacy Critique” Peter Swire Moritz College of Law Attorneys General Education Program Conference on the Economics of Consumer Protection George Mason University October 22, 2012

  2. Overview • EU Right of Data Portability (RDP) in draft privacy Regulation • Idea of portability very attractive • Antitrust perspective • What creates consumer welfare • Privacy perspective • Control over “your” data but with what rules • What to do

  3. Why Portability is Attractive • You post “your” data to the cloud, a social network, an app • Avoid lock-in: you can switch to a new social network or cloud provider • High switching costs: manual downloads are slow, clumsy • Goal of EU Art. 18: • Individual gets back data uploaded • Individual “without hindrance” can transfer personal data from 1st to 2d service (the “export-import module”)

  4. Antitrust Concerns • Antitrust goal to max consumer welfare • Concerns with Art. 18: • Applies to all online services, even start-ups • No market power requirement • Fails to consider efficiencies of what software companies include in offerings • Interoperability difficult • Cost of creating EIM • Dynamic efficiency & incentives to compete for the market

  5. Antitrust (cont.) • In essence a per se rule requiring portability • Refusal to deal – lots of company discretion • Tying and Microsoft – rule of reason • They require showing of market power before regulating • Conclusion on antitrust • Differs greatly from consumer welfare goal in US and EU antitrust analysis

  6. Privacy & Data Portablity • EU idea – fundamental right to autonomy, individuals should control “their” data • Responses/questions: • A human right to “data portability”? • Rights of the individual on the other side • Right to data security – don’t want a lifetime of data taken with a moment’s identity theft • Should look realistically at costs and benefits, rather than asserting a new right, with no experience in operation

  7. Some Conclusions & Questions • Consumers do benefit from portability, from avoiding lock-in & high switching costs • The rules should learn from antitrust experience with exclusionary practices • Market power, efficiencies, rule of reason • Be cautious about sweeping declaration of a new right, with no experience in practice • Applies to any online services that sell to EU • What to do now? • Jawbone, and major companies have shifted • Look for actual problems, and then act

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