Original version
European Competition Law Review. 2019, 40 (4), 166-181
Abstract
In recent years, privacy has started to attract considerable attention in competition discussions, particularly in mergers involving data-rich industries. Prime examples of such mergers include Google/DoubleClick, Facebook/WhatsApp and the recent acquisition of LinkedIn by Microsoft. Given the central role that personal data plays in these mergers and associated privacy concerns for users, competition authorities have started to experiment with ways to incorporate privacy into merger assessment. One emerging approach is to factor in privacy as a non-price competition parameter. In its merger decisions involving Facebook/WhatsApp and subsequently Microsoft/LinkedIn, the European Commission held that data privacy constitutes a key parameter of non-price competition in the market for consumer communications and for professional social networks. This article provides a critical analysis of these decisions regarding the competition in privacy and Privacy Enhancing Technologies (PETs). The analysis is conducted from two angles: one looking at the Commission’s approach in defining the market, particularly on how competition in privacy and PETs is manifested and when two firms are considered competitors based on these parameters and thereby of interest to competition law. The second angle takes aim at the competitive assessment and the theories of harm, particularly when a merger is considered to lead to reduction in privacy as a non-price competition parameter. The article maintains that the Commission’s decision in Microsoft/LinkedIn represents a step forward in the discussion of privacy as a non-price (quality) competition parameter and the use of market power to harm such competition.