Antitrust Concerns in the Age of Data-Driven Economies: The Need to Revive the ‘Essential Facilities Doctrine’

Abstract

The advent of digital economy, more particularly platform markets has increased the role of ‘data’ massively. Data is the central fuel around which business strategies are made coupled with associated algorithms to increase the conversion rates. It is true that since today’s markets are data-driven in nature, dominant undertakings having access to data may end up prohibiting competitors to scale up their networks by exhibiting some explicit or implicit exclusionary conduct against them. Moreover, platform economies exhibit certain distinct characteristics such as network effects, feedback loops, economies of scope and scale and switching costs which in reality end up facilitating ostracization of small or new players. Various antitrust cases against big tech giants such as Google, Microsoft etc. in the recent past have brought forth the reality of such exclusionary conduct. Considering the fact that data is not only needed but is essential for today’s digital businesses, the question arises if sharing of data with market players in certain situations must be ensured. From the lens of antitrust, the central issue is whether data should be considered as an ‘essential facility’ and under what circumstances. Essential facilities doctrine is inspired by the firms’ duty to share which initially was applicable for infrastructural facilities such as phone lines and bridges, but considering that firms may refuse to share data impeding innovation in today’s era, the author argues that the said doctrine, with some qualifications, must be revisited to grant open access to data.