Privacy and Antitrust

Privacy and Security and Competition Policy and Antitrust

Article Snapshot


Peter Swire


GMU/Microsoft Conference on the Law & Economics of Innovation, May 8, 2009


This paper looks at how privacy policy and competition policy intersect.

Policy Relevance

Some mergers should be permitted only if the firms agree to protect consumer privacy.

Main Points

  • Competition between firms can take the form of price competition, or non-price competition. Competition affecting consumer privacy is a form of non-price competition, like offering a warranty.

  • The FTC recognized that privacy can be a consideration in the merger between Google and Doubleclick.

  • In Europe, consumer privacy is recognized as a fundamental right that could be protected by competition policy, but the legal basis for this in the United States is weak.

  • Antitrust cases recognize that non-price competition is important.

  • Consumers that value privacy are harmed if, as the result of a merger, there is less competition to protect privacy.

  • Many consumers say in response to surveys that they place a high or medium value on privacy.

  • Firms do compete to provide privacy for consumers.

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