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Looking Up in the Data-Driven Economy

6 Pages Posted: 30 May 2017 Last revised: 12 Sep 2017

Maurice E. Stucke

University of Tennessee College of Law; The Konkurrenz Group

Ariel Ezrachi

University of Oxford - Faculty of Law

Date Written: May 26, 2017

Abstract

With the rise of the super-platforms, we tend to look down (on their effect on consumers) rather than up (their effect on sellers and upstream providers). In looking down it seems like Google, Amazon and Facebook are using their power in the marketplace to deliver great value to us — wrestling lower prices from producers in the case of Amazon, bringing news onto a single platform in the case of Facebook, and organizing the world’s information, in the case of Google.

While these companies appear to be furthering our interests, a closer look reveals how these super-platforms may wield their power downstream to harm us, the consumer. As our book Virtual Competition explores, the super-platforms can use our personal data to better price discriminate and their disincentive to protect our privacy (and promote technologies that do).

Less discussed, but of significant concern, are the upstream effects of these super-platforms. They have the power to harm many of the companies from whom they buy or acquire content — and that harm ultimately harms us.

In looking up rather than down, we see how the super-platforms can squeeze millions of sellers, including photographers, photojournalists, writers, journalists and musicians. Our competition laws deal with this kind of buyer power. These concerns, however, are often low on the enforcement agenda due to the indirect effects on “consumer welfare,” which is often measured by the price you pay for the goods or service. So if we stream the YouTube video ostensibly for “free,” the assumption is that our welfare is maximized. In the digital age, as this essay argues, that urgently needs to change.

Keywords: e-monopsony, e-scraper, antitrust, competition law

JEL Classification: K21

Suggested Citation

Stucke, Maurice E. and Ezrachi, Ariel, Looking Up in the Data-Driven Economy (May 26, 2017). University of Tennessee Legal Studies Research Paper No. 333. Available at SSRN: https://ssrn.com/abstract=2975510 or http://dx.doi.org/10.2139/ssrn.2975510

Maurice E. Stucke (Contact Author)

University of Tennessee College of Law ( email )

1505 W. Cumberland Ave.
Knoxville, TN 37996
United States
865-974-9816 (Phone)

HOME PAGE: http://law.utk.edu/people/maurice-stucke/

The Konkurrenz Group ( email )

5335 Wisconsin Ave., NW
Suite 440
Washington, DC 20015
United States

Ariel Ezrachi

University of Oxford - Faculty of Law ( email )

Oxford
United Kingdom

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