Digital cos data hegemony may lead to an “attention economy,” says CCI chief, Telecom News, ET Telecom


New Delhi: Competition Commission chief Ashok Kumar Gupta on Thursday signaled that data hegemony by some digital companies could lead to an “attention economy” in which big tech players are working to capture the attention of users, create profiles of their choice and sell the profiles to advertisers. The remarks of the president of the country’s fair trade regulator are gaining importance in the context of the concerns of some about the business practices of large technology entities and also of certain digital players under the watchdog.

While noting that rapid changes are occurring in markets, which are increasingly moving towards a digital platform-centric setup, Gupta also noted that these platform markets are, by their very nature, ” the winner takes everything or the winner takes the most ”.
“Network effects, access to large amounts of data, economies of scale and scope, induced behavioral biases among consumers, etc., in digital markets can increase market concentration and lead to the creation of impermeable barriers to entry, ”he said.

Speaking at a competition law conference hosted by industry body Assocham, Gupta said data hegemony by some digital companies can lead to an “attention economy.”

In an “attention economy”, the big technological players strive to capture the attention of users, create profiles of their choices and habits, then sell these profiles to advertisers, he said. added.

“Moreover, since these digital platforms are the ones that set the rules for how different users would interact on their platform, it prompts them to engage in behavior that can not only hamper competition in the marketplace, but can also strengthen their historical advantage, “Gupta said.

According to him, the regulator has a very important role in ensuring that these platforms remain neutral, offer a level playing field and allow companies, large and small, who access consumers through these platforms to compete on the basis of merit.

The Chairman of the Competition Commission of India (ICC) acknowledged that in these dynamic and rapidly changing markets, a regulator’s job is very much like moving targets, adding that the regulatory position needs to be nuanced and that the application toolkit must be adapted. to these changes so that the instrument remains fit for purpose.

“The challenge is to keep abreast of developments in these markets and to continue to evolve and refine the tools. This will help to make timely interventions and strike the right balance so that efficiency and innovation are not stifled while markets are free from anti-competitive practices. “, noted Gupta.

In addition, the head of the ICC said that disruptive technology and innovation in the digital economy are rapidly changing the contours of markets, transforming the way of doing business, the means of communication and the modes of transaction.

The “tech-laden economy” brings new problems and concerns to the discourse on competition policy, he added.

Speaking about merger control in digital markets, Gupta said data is a crucial factor for economic power and for judging market power on the internet.

He also noted that, since not all digital markets are the same, and not all data is the same, interventions in merger reviews in technology markets must be guided by economic evidence specific to the case of competition issues.

“With an increasing number of acquisitions and investments, the large platforms are continually expanding the scope of their business interests, and the motivation may be the collection of additional data that helps to strengthen their position in the market,” said Gupta.


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