The European Commission is taking a closer look at companies that are using big data as a way to smother competition.
The EU Commissioner for Competition, Margrethe Vestager, spoke at a conference in Germany and warned that the EU may be forced to step in to level the playing field.
"If a company’s use of data is so bad for competition that it outweighs the benefits, we may have to step in to restore a level playing field," she said.
While Vestager said that it is good that companies are using their data to improve the quality of services for customers and to cut costs, she said: "But if just a few companies control the data you need to satisfy customers and cut costs, that could give them the power to drive their rivals out of the market.
"And with less competition, there’s a risk that there won’t be enough incentive for companies to keep using big data to serve customers better."
The issue of how much data is being controlled by one company has been raised before by the Commission, most recently in Facebook’s acquisition of WhatsApp.
The concern is that while data can give you a competitive advantage, its use and importantly collection need to be monitored to make sure antitrust rules aren’t being breached.
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Article 101 and Article 102 of the Treaty on the Functioning of the European Union set out how the EU monitors competition.
In Article 101 it sets out that no agreement between two or more independent market operators can be made which restricts competition, while Article 102 prohibits firms that hold a dominant position in a market to abuse that position.
This means that companies in a dominant position can’t charge unfair prices, limit production or refuse to innovate to the prejudice of consumers.
While there is plenty of massive tech companies that suck up vast amounts of data, none yet have been in trouble for doing so, but the EU is watching closely.
Vestager’s comments highlight the growing focus that is being placed on big data. With the EU’s General Data Protection Regulation due to come into force in two years time and the rewritten Safe Harbour agreement also to be decided upon, there is a big clamp down on improper data use.
Something that the EU will need to be wary of is not over regulating the industry so that businesses become too limited in how they can use big data.
This is particularly important if the EU wants to support the growth of global organisations and not limit them under unfair competition rules.
Often data isn’t exclusive to one company as it is possible for many different companies to hold the same information at the same time. For example, a business could search out Data-as-a-Service from a company like Oracle and buy access to large amounts of data.
Although Vestager said that the EU would be watching the use of big data, it is unlikely that there will be any special antitrust regulation.
Vestager, said: "We don’t need a whole new competition rulebook for the big data world, just as we didn’t need one for a world of fax machines, credit cards or personal computers."
