Authored By: Kimaya Joshi (B.B.A.LL.B (Hons)), NMIMS Hyderabad, Research Writer at Law Audience,
Edited By: Mr. Varun Kumar, Advocate, Himachal, Punjab & Haryana and Founder at Law Audience
Introduction
In this escalating digital economy, most antitrust agencies around the world are focusing on the challenges in the enforcement of antitrust laws posed by the data in possession of tech giants. This is due to increasing importance of data and reliance placed on it by companies especially after Covid 19. Right now, there is infinite amount of data being generated, processed and circulated across the world. This increasingly growing value of data is recognised by many industry experts and businesses. It is not wrong to say that Data is the new oil.
Digital Market
The digital economy is considered to encompass all economic activities that rely on digital inputs and data.[1] Markets within these economies are referred to as digital markets or digital platform markets.[2] And, a central element of these digital ecosystems is data.
Data is used by digital platforms in primarily three ways –
- To enlarge their existing data inventories by adding raw data,
- Using the acquired new data in the form of input to algorithms thereby complementing prediction
- It is also used to improve or optimise an already existing data set.[3]
Hence, it is clear that possession of data reaps hefty economic benefits for digital platforms in forms like targeted advertising, data analytics, etc. This economic significance of data has become a ground where digital economies compete. And this leads to a well existing reality that data has become a commodity.
Technological developments played a crucial role by aiding in revolutionising the cost to acquire, process, and store data, thus facilitating the aggregation of large quantities of data, and today all the enterprises in the digital economy have data-driven business models; that is, these entities thrive by collecting, processing, and analysing data on a large scale. Due to such a data-centric business model, it is crucial to consider the commercial use of data when assessing competitive concerns in digital markets.[4]
Competition Landscape
With the surge of digital markets over the last two decades, overtime legal understanding of these digitals markets gradually evolved. The understanding that offline and online are merely “two different channels of distribution and not different markets in themselves”[5], was proved to be flawed as the dynamics of offline and online markets are significantly different from each other. This can be seen by actually looking at the non- price dimensions in the online markets like network effects which are extremely important.[6]
Furthermore, in multi-sided platforms, services are offered free of cost on one side of the platform to collect user data giving rise to a zero-price model. On the other side of the market this collected user data is used to earn revenue. [7] A great example for this is the working of Google. It provides free search engine services and acquires data from all around the globe. This data is in turn used by it to facilitate targeted advertising hence generating revenue.
Market Power and Barriers to Entry
Market power is the ability of a company or entity to influence prices and control terms within its market, often reducing competition by creating barriers to entry.[8] Traditionally, the main criteria that is used to determine market power is size of the enterprise, its resources, market share, etc. Now, however it is widely being recognised and accepted that, profits may not be the true indicator of market power in data markets. In digital markets, market power can be ascertained by the amount as well as the nature of the data collected by the firms, including both personal and non-personal data (either publicly available or acquired through tracking).[9] Most of the digital platform markets today are multi-sided markets. In these markets, success of one said of the markets depends on the flourishing of the other side. So, while big tech companies do not gain anything directly from raw data they collect, by constructing and analysing it, they generate revenue. The companies not only collect the data of user’s interaction with their platform but also behavioural data in form of patterns.
Since, the already existing players in the digital market hoard large sums of data especially historical, the new startups and platforms face lack of the historical data with them just gaining access to the surface level. The big tech companies with their decades long concrete systems have established a strong hold in the market by becoming rich in data.
The lack of access to this data renders tough competition to new players in offering quality products to consumers, efficiently reprogramming their AI technology, and sustaining the competition in the digital market without incurring huge losses initially. The new entrants are forced to compete with players who have already gained the advantage of networking effects, changing the dynamics of the market as “winner take all”, thus, creating artificial barriers and making co-existing in the same market improbable.[10]
A snowball effect is created wherein the data collected by big tech companies grow exponentially through collection, analysis and feed back loop with a continuous cycle enhancing quality of services, at the same time, the new players go further down with the gap widening and them being unable to acquire more customers and tailoring their products. Hence, apart from traditional criteria, data also acts as a component to act as a barrier to entry and facilitate anticompetitive practices.
Ecosystem Approach
Regulators have come up with and adopted the Ecosystem Approach in order to deal with the multi-sided digital platforms. This is because of the recognition that multi-sided platforms act as ecosystems where a web of products and services work in tandem with each other and aggregation or interlinking of these services result in profits for the enterprises. Hence, it would be fruitless to access each service independently, rather the whole plethora of the services have to be accessed together to see the standing of the organisation. It may happen that a single core product or service is the centre of the ecosystem and all other products and services are created to work in tandem with the core product or service. An example of this would be operating systems i.e., Apple’s iOS and Google’s Android are core services.
Conclusion
Regulators all across the world are in fix to adopt to the changes brought in by technological developments, trying to ensure that the Anti Competition laws remain relevant and effective cratering to the novel challenges. One big step taken in that direction is the recognition of data as value in today’s time. Mergers and Acquisitions are reviewed while taking into account the data possessed by the entities. Still, there is a need to find effective solution to regulate the big tech giants and ensure free and competitive markets.
[1] OECD, OECD Handbook on Competition Policy in the Digital Age (2022), https://www.oecd.org/en/publications/oecd-handbook-on-competition-policy-in-the-digital-age_c8c1841b-en.html.
[2] Id.
[3] Torsten Körber, Is Knowledge (Market) Power? – On the Relationship Between Data Protection, “Data Power” and Competition Law (Jan. 29, 2018), https://papers.ssrn.com/abstract=3112232.
[4] Tanmay Doneria, Data as a Determinant of Market Power in the Digital Economy: Factoring in Qualitative and Quantitative Considerations, 11 National Law School Business Law Review (2025), https://repository.nls.ac.in/nlsblr/vol11/iss1/3.
[5] Mr Ashish Ahuja, COMPETITION COMMISSION OF INDIA (Case No. 17 of 2014).
[6] Organisation for Economic Co-operation and Development, Abuse of Dominance in Digital Markets: Executive Summary (2020), https://one.oecd.org/document/DAF/COMP/GF(2020)7/en/pdf
[7] Topics on Assessment of Dominance in Digital Markets, ICN, https://www.internationalcompetitionnetwork.org/portfolio/topics-on-assessment-of-dominance-in-digital-markets/ (last visited June 14, 2026).
[8] Thomas Brock Full Bio Thomas J. Brock is a CFA et al., Understanding Market Power: Definition, Examples, and Impact on Pricing, Investopedia, https://www.investopedia.com/terms/m/market-power.asp (last visited June 14, 2026).
[9] Abha Yadav and Tarun Donadi, Competition Law and Significance of Data in Determination of Market Position, 6(1) INDIAN COMPETITION LAW REVIEW (2020).
[10] Lina M Khan, THE SEPARATION OF PLATFORMS AND COMMERCE.
