The Role Of Big Data In Determining Dominant Position

Big data, which is one the key issues of personal data protection law, has also become a highly disputed sub-topic of competition law in recent years. Big data, a great set of structured and unstructured data, with no exact definition, is explained via certain criteria such as volume, velocity, variety, veracity and value. Although the first reason that comes to mind in terms of qualifying the data set as “big” is the large number of data, the amount is not the only factor playing role in this qualification. The term big data refers to data that is too large, too fast or too complex to be processed by conventional methods. Big data with an extensive usage area also plays an important role in making correct business decisions and strategic moves. When approaching to big data owning companies individually, it is seen that they show a significant progress and when they are evaluated with companies which do not have the opportunity to access big data, it is seen that important disadvantages appear in terms of competition law.

As data started to be used as meta in business life, big data has become a competition object on its own. Most especially with digitalization, existing data collecting companies stated to form their corporate strategies and new business models based on big data. This brings high turnovers and great progresses for mentioned companies while creates a competition hindering dominant position for companies which have no access to big data.

The fact that companies with big data do not share this resource with other companies in a similar position within the market, or share only with certain selected partners, may create an obstacle to entering the market. As mentioned above, market dominance, which can also be considered as monopolization of data-oriented undertakings, is not only associated with the amount of data owned. Existence of market dominance, which is related to different criteria besides the number of data, can be determined through answering following questions:

  • Do other competing companies have access to same data?
  • Is there any other data that can replace data owned by the company, whose dominance is evaluated?
  • Does the company, whose dominance is evaluated, have the authority to analyze collected data?
  • Is the data owned by the company, whose dominance is evaluated, processed or unprocessed?

Data-driven products such as social media, shopping and agency websites require great amount of data to be used and the fact that these data are in one or certain hands and obstructing the data-access for other undertakings will result in abuse of dominant position in the market. Such large data collecting companies usually consist of two or more directional platforms and provide free service to users while making a gain from data collected from users. Although the service activity alone does not cause to any contradiction to law, the activity process and its effects on other undertakings may result in violation of competition law. Bundeskartelamt-Facebook investigation is one of the basic and most important examples in this context. Facebook is a tough competitor with its other incorporated social networking applications. Facebook maintains its users by advantaging their fear of losing existing connections and preserves its collaborations such as advertisers by means of potential customer portfolio build through its extensive user group. In other words, Facebook, which has no competitor company, is selected among practically infeasible options through benefiting its big data resource. Demanding personal data in exchange of providing service does not result in any contradiction to law. However, placing personal data processing as a condition on provided service proves that the condition of explicit consent in both national and international legislation is not fulfilled. The German Federal Court has examined the personal data processing condition of Facebook on the ground that its illegality also effects German market based on the impact theory. Within the scope of investigation, it was stated that the consent of the user did not include a healthy will and was not obtained on a volunteer basis. As a result of the investigation, the German Federal Court decided to prohibit the data processing policy of Facebook in Germany on account of the facts that, Facebook’s abuse of dominant position and obstruction of users’ and advertisers’ other options cause violation of competition law and oblige users to share their personal data.

Personal data / personal data law, which does not even have a long history on its own, has gone beyond its field limits through digitalization and innovations and has started to effect commercial and competition law. The relationship between personal data and competition law is dealt within the context of big data and constitutes the basis of important discussions. Dominant position of data collecting companies such as Amazon, Google and Facebook obstruct the competition in data-oriented markets, where the data is accepted as the raw material of the competition. Above mentioned Facebook investigation is a very important example to understand the point of view required in this context.