Privacy withing the gambit of Competition and Anti-Trust laws


Aayush Kedia

The question of privacy and anti-trust came to be read together in the March of 2019, when the FTC commission for Rhode Island, probed in the working of Facebook and Google(now Alphabet Inc.) and how these companies have been acquiring prospective competitors and eliminating future competition. This may seem anti-competitive in nature, but the larger concern was that of data privacy. The act of Facebook to acquire Instagram and WhatsApp (in 2012 and 2014 respectively) could potentially be anti-competitive,  but at the same time, Facebook is also using its monopoly power to degrade the quality of its service, below the benchmarks of competitive market places. Moreover, Google, on the other hand, announced the closing of Orkut in 2014. This made the customers resort to Facebook.

The primary issue as has been highlighted, it can be seen that, even though you can control your privacy settings on Facebook, however In the case you delete the same, the previous access is given by you to third party agents, still allow Facebook to track your online activity. Once deleted, you cannot access the privacy settings to opt-out of this setting. This. Tracking of customers, allows Facebook to collect large amounts of data about an individual than they previously could. This can be used by them for financial exploitation. 

In today’s time, there is no aggressive exploitation by the company concerning our anti-trust laws and regulations, however, as has been mentioned by the Harvard School of Competition Thought on anti-trust laws “Big is always bad”. Though presently, they are not exploiting the data accumulated by them, however, once the data starts getting leaked, it’s like the genie is out of the bottle, it’s not possible to curtail and control the same. Hence, by combining the aggressive implementation of anti-trust laws against these companies, we can see that the government is also working towards establishing an economy where people can enjoy their basic right to privacy.

From the above, we can see that there is a constant pressure on companies like Google and Facebook to control and curb their expansion, which ideally goes against the basic principles of freedom of doing business. But at the same time, they are facing a threat of anti-competitive measures. The reason the same is happening is that the practices of these companies primarily defeat the theory behind today’s Anti-trust laws of Ordoliberalism. They are preventing the customers from having a choice of social media platform to connect and communicate over. 

The main drawback of the same has been mentioned by Pamela Harbour,  the FTC Commissioner who dissented to the merger of Google and DoubleClick, which could be read as,  “the merger creates a firm with a vast knowledge of consumer preferences, subject to very little accountability”. Hence, the primary concern of the authorities is the chance of exploitation of consumer data, since “the more a company knows about a person, the vulnerable the person becomes”

Thus, the merger of potentially competitive companies is the reason the diversity of privacy practices could be lost.

Hence, in a nutshell, the worry about privacy is a real uprising danger, but the reason this exists is the creation of a monopoly in the social media and technology market. 

Though data privacy and anti-trust laws are not related under a broad perspective, we can see that there is a major overlap between both, since one is the reason for the existence of the other. One way the authorities can control the same is by over enforcing regulations, but still, they would be causing a Type I error i.e. over-enforcement causing restriction of free trade practices. Hence, this debate is a 2 sided sword,  where one is data privacy and the other is anti-trust rule violations. Hence, it is safe to conclude that both of them co-exist.

The heat of this debate on Privacy versus Competition Concerns has been faced in India, since the Delhi High Court via their order dated 22nd April 2021 has denied to order the Competition Commission of India to stop their probe into the Privacy Policy of Whatsapp and Facebook. The matter is currently being heard before the Supreme Court of India.

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