The Role of Big Data in Shaping Personal Data Protection and Competition Law

Introduction

With increasing digitization, a complex relationship has emerged between personal data protection law and competition law. Historically, competition authorities were hesitant to recognize the impact of personal data on market dynamics. However, recent advancements have led to greater awareness and the development of policies that reflect this evolving relationship.

Consequently, the commercialization of personal data has raised significant privacy concerns that intersect with both data protection legislation and competition law. As the use of data for commercial purposes expands, it becomes crucial to integrate privacy considerations into competition law. Moreover, market power driven by data presents unique challenges in balancing privacy and competitive practices.

In Türkiye, the interplay between personal data protection and competition law is addressed through the Collaboration and Information Sharing Protocol (“Protocol”) established between the Personal Data Protection Authority and the Competition Authority.[1] This Protocol facilitates joint initiatives to achieve common goals such as intervening in potential harm areas, raising awareness of data protection and competition issues, delivering unified messages to businesses, and sharing expertise to ensure effective competition and enhanced consumer control over personal data.

1. The Economic Value of Personal Data

1.1. Economic Impact and Digital Transformation

Personal data has emerged as a crucial asset across various domains. It shapes customer preferences, guides business strategies, and fuels innovation processes. Although users often do not make direct monetary payments on digital platforms, service providers sustain operations through revenues generated from advertisers. For advertisers, user data is a pivotal resource for targeting, while platforms leverage it to develop new products. These dynamics not only highlight competitive advantages but also underscore the concerns related to personal data protection and competition law. The transformative impact of digitization and big data on business models is significant, with data now serving as a fundamental input in the production of goods and services. This shift has led to structural changes in economies. Advancements in internet technology have further enhanced data collection and analysis capabilities, fostering new business relationships and collaborations. Consequently, leveraging data has become essential for gaining a competitive edge in today's market.

1.2. Transformation in Business Models and Market Dynamics

The rise of a data economy highlights the necessity of data as a vital input for competitive advantage. As data accumulation, accessibility, and AI-enabled analysis increase, companies can gain deeper insights into consumer behavior and develop data-driven marketing strategies. However, it is crucial to balance privacy and competition concerns amid these structural shifts. Market players assume varied roles in the data economy based on their market positions, internal structures, and capacities. The importance of data quality and quantity for competitive success is paramount. As the data economy evolves, competition authorities are becoming increasingly aware of the significant role of big data. Concerns arise when data control is monopolized, particularly when a few companies possess the necessary infrastructure for market dominance.

2. The Concept of Big Data and Its Impact on the Competition Market

2.1. Proliferation and Understanding of Big Data

Digitalization has enabled internet platforms and electronic devices to autonomously generate diverse datasets without explicit user knowledge. Smartphones with GPS or Wi-Fi track location data, while wearable devices like smartwatches monitor health metrics. These datasets are stored and analyzed by service providers, subject to legal regulations. Big data refers to the rapid analysis of extensive and varied datasets from multiple sources. Characterized by attributes such as volume, velocity, variety, and value, big data's economic impact is profound. Analyzing these elements helps understand how big data integrates into economies and influences economic actors, illustrating the convergence of digitization and competition law.

2.2. Impact on Competition and Innovation

While big data offers opportunities for product innovation, cost efficiency, and market effectiveness, it also presents risks of misuse and anti-competitive practices. Recognizing big data as a valuable asset is crucial for market survival and competitive advantage. However, preventing data monopolization and potential digital cartels is essential to maintain fair competition and protect data integrity.

Conclusion

The intersection of personal data protection and competition law is increasingly significant. The economic value of big data provides companies with a competitive edge but also raises concerns about misuse and restricted competition. The Protocol between Türkiye's Personal Data Protection Authority and the Competition Authority is a positive step towards balancing these concerns. This protocol aims to address both personal data protection and competition issues effectively. Despite these efforts, it is essential to continuously update the regulatory framework to keep pace with rapid technological advancements. Evolving regulations in tandem with technological progress will help mitigate risks and ensure fair competition.

References

Kişisel Verileri Koruma Kurumu ile Rekabet Kurumu Arasında İş Birliği ve Bilgi Paylaşımı Protokolü İmzalandı (Only in Turkish). (2023, October 26). Retrieved from Personal Data Protection Authority: https://www.kvkk.gov.tr/Icerik/7732/Kisisel-Verileri-Koruma-Kurumu-ile-Rekabet-Kurumu-Arasinda-Is-Birligi-ve-Bilgi-Paylasimi-Protokolu-Imzalandi