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New Delhi: Competition Commission chief Ashok Kumar Gupta on Thursday indicated that data hegemony by some digital companies could lead to an “attention economy” in which big tech players work to capture users’ attention, create profiles of their choice and sell profiles to advertisers. Huh.
The remarks from the chairman of the country’s fair trade regulator assume significance against the backdrop of concerns over some quarters about the business practices of large tech entities and some digital players coming under the lens of surveillance.
Noting that markets are changing rapidly, which are increasingly moving towards a digital platform-centric configuration, Gupta also pointed out that these platform markets are by their very nature “winner-take-all or winner-take-all”. -most”.
“Network effects, access to large amounts of data, economies of scale and scope, induced behavioral bias among consumers, etc., can increase market concentration in digital markets and result in the creation of impenetrable entry barriers,” he said. said.
Addressing a conference on competition law organized by industry body Assocham, Gupta said data possession by some digital companies could lead to an “attention economy”.
In the “attention economy,” the big tech players work to capture users’ attention, create profiles of their likes and habits, then sell those profiles to advertisers, he said.
“Moreover, since these are digital platforms that make up the rules for how different users will interact on their platforms, it gives them an incentive to engage in conduct that can not only hinder competition in the market but also gain power from them. can also strengthen it,” Gupta said.
According to him, the regulator has a very important role to play in ensuring that these platforms remain neutral, provide a level playing field and allow enterprises, large and small, to compete on merit through these platforms to access the consumers. .
The Competition Commission of India (CCI) chairman acknowledged that in these fast-paced and dynamic markets, the act of a regulator is like hitting moving targets, adding that there is a need to fine-tune the regulatory stance and optimize the enforcement toolbox. These changes are needed so that the instrument remains fit for purpose.
“The challenge is to continue to develop and refine the tools as they grow in these markets. This will help in timely intervention and strike a fine balance so that efficiencies and innovation are not affected, while markets are free from anti-competitive practices ,” said Gupta.
Further, the CCI chief said that technology and disruptive innovations in the digital economy are rapidly changing the contours of markets, the way we do business, the way we communicate and the way we transact.
He said the “technology-laden economy” is bringing new issues and concerns into the discourse of competition policy.
Talking about merger control in digital markets, Gupta said that data is an important factor for economic power and for determining market power on the Internet.
They also noted that since not all digital markets are alike, nor are all data, interventions in reviewing mergers in technology markets need to be guided by case-specific economic evidence of competition concerns.
Gupta said, “With the increasing number of acquisitions and investments, large platforms are constantly expanding the scope of their business interests, and the motivation may be the collection of complementary data that helps them consolidate their market position. “
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