“Why the Right to Data Portability
Likely Reduces Consumer Welfare:
Antitrust and Privacy Critique”
Peter Swire
Moritz College of Law
Attorneys General Education Program
Conference on the Economics of Consumer Protection
George Mason University
October 22, 2012
Overview
• EU Right of Data Portability (RDP) in draft
privacy Regulation
• Idea of portability very attractive
• Antitrust perspective
• What creates consumer welfare
• Privacy perspective
• Control over “your” data but with what
rules
• What to do
Why Portability is Attractive
• You post “your” data to the cloud, a social
network, an app
• Avoid lock-in: you can switch to a new
social network or cloud provider
• High switching costs: manual downloads
are slow, clumsy
• Goal of EU Art. 18:
• Individual gets back data uploaded
• Individual “without hindrance” can
transfer personal data from 1st to 2d
service (the “export-import module”)
Antitrust Concerns
• Antitrust goal to max consumer welfare
• Concerns with Art. 18:
• Applies to all online services, even start-ups
• No market power requirement
• Fails to consider efficiencies of what software
companies include in offerings
• Interoperability difficult
• Cost of creating EIM
• Dynamic efficiency & incentives to compete
for the market
Antitrust (cont.)
• In essence a per se rule requiring portability
• Refusal to deal – lots of company
discretion
• Tying and Microsoft – rule of reason
• They require showing of market power
before regulating
• Conclusion on antitrust
• Differs greatly from consumer welfare goal
in US and EU antitrust analysis
Privacy & Data Portablity
• EU idea – fundamental right to autonomy,
individuals should control “their” data
• Responses/questions:
• A human right to “data portability”?
• Rights of the individual on the other side
• Right to data security – don’t want a
lifetime of data taken with a moment’s
identity theft
• Should look realistically at costs and
benefits, rather than asserting a new right,
with no experience in operation
Some Conclusions & Questions
• Consumers do benefit from portability, from
avoiding lock-in & high switching costs
• The rules should learn from antitrust experience
with exclusionary practices
• Market power, efficiencies, rule of reason
• Be cautious about sweeping declaration of a
new right, with no experience in practice
• Applies to any online services that sell to EU
• What to do now?
• Jawbone, and major companies have shifted
• Look for actual problems, and then act