Abstract
Digital personal data are increasingly hoarded in data enclaves controlled by Big Tech. These large digital technology businesses dominate their markets through the pursuit of a particular form of parasitic innovation. They are able to create data enclaves by extending their digital ecosystems comprising an assemblage of technical devices, platforms, users, developers, and payment systems as well as legal contracts, rights, claims, and standards. Data enclaves provide Big Tech with the means to entrench their market dominance through the enrolment of other businesses, users, consumers, developers, and so on in the success of Big Tech’s ecosystems: everyone becomes tied into buttressing the benefits that access to the data enclave provide. Here, I use the notion of parasitic innovation to define the strategic attempt to dominate markets, avoid competition, and undermine competitors, leading to the erosion of markets and their replacement by ecosystems whose rules are set by Big Tech.
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Notes
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I drew on the following academic, business, and policy literature for much of this discussion: ClearCode.cc Adtech Book, available online at: https://adtechbook.clearcode.cc/; Gerardin, D. and Katsifis, D. (2019) An EU competition law analysis of online display advertising in the programmatic age, European Competition Journal 15(1): 55–96; Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54; Bitton, D. and Lewis, S. (2020) Clearing up misconceptions about Google’s ad tech business, available at: https://www.competitionpolicyinternational.com/clearing-up-misconceptions-about-googles-ad-tech-business/; Srinivasan, D. (2020) Why Google Dominates Advertising Markets: Competition Policy Should Lean on the Principles of Financial Market Regulation, Stanford Technology Law Review 24(1): 55–175; ACCC (2020) Digital advertising services inquiry, Canberra: Australian Competition and Consumer Commission, available at: https://www.accc.gov.au/publications/digital-advertising-services-inquiry-final-report; CMA (2020) Online platforms and digital advertising market study, UK Competition & Markets Authority, available at: https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study; Scott Morton, F. and Dinielli, D. (2020) Roadmap for a Digital Advertising Monopolization Case Against Google, Omidyar Network, available at: https://publicknowledge.org/policy/roadmap-for-a-digital-advertising-monopolization-case-against-google/; Sweeney, M. (2022) Understanding the Complicated World of Advertising Technology (AdTech) & Programmatic Advertising, Clearcode, available at: https://clearcode.cc/blog/understanding-advertising-technology/; and McGuigan, L. (2023) Selling the American People, Cambridge MA: MIT Press; and MacKenzie, D., Caliskan, K. and Rommerskirchen, C. (2023) The longest second: Header bidding and the material politics of online advertising, Economy & Society.
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Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54; also see ClearCode.cc Adtech Book, available online at https://adtechbook.clearcode.cc/
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See ClearCode.cc Adtech Book, available online at https://adtechbook.clearcode.cc/.
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Gerardin, D. and Katsifis, D. (2019) An EU competition law analysis of online display advertising in the programmatic age, European Competition Journal 15(1): 55–96; quote at p. 61.
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Srinivasan, D. (2020) Why google dominates advertising markets: Competition policy should lean on the principles of financial market regulation, Stanford Technology Law Review 24(1): 55–175, at p. 76.
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See the Statista report on “digital advertising” by Chanthadumrongrat (2022) Digital Advertising—Market Data Analysis & Forecast, Hamburg: Statista.
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Chanthadumrongrat (2022) Digital Advertising—Market Data Analysis & Forecast, Hamburg: Statista.
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CMA (2020) Online platforms and digital advertising market study, UK Competition & Markets Authority, available at: https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study, p. 155 and p. 280.
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According to their annual financial reports, in 2015 around 90 percent of Alphabet/Google’s revenues came from advertising, which has slowly declined over time, to around 80 percent in 2022. Advertising revenue in 2022 was split between: “Google Search & other” (US$162b), “YouTube ads” (US$29b), and “Google Network” (US$33b).
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Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54.
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Stucke, M. (2022) Breaking Away: How to Regain Control Over Our Data, Privacy, and Autonomy, Oxford: Oxford University Press.
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According to the UK’s Competition and Markets Authority (CMA), “Google Search has default agreements covering much more of the mobile device sector (at least 94%) than the desktop PC sector (29%). In turn, Google has a relatively higher share of supply in mobile search (97%) than it does in desktop search (84%)”; see CMA (2020) Online platforms and digital advertising market study, UK Competition & Markets Authority, available at: https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study, p. 102.
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US House of Representatives (2020) Investigation of Competition in Digital Markets, Washington DC: House of Representatives, quote at p. 345.
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In Re: Google Digital Advertising Antitrust Litigation, 14 Jan 2022, available at: https://www.documentcloud.org/documents/21179902-3rd-complaint-for-texas-google-antitrust-case.
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Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: Analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54; quote at p. 18.
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In Re: Google Digital Advertising Antitrust Litigation, 14 Jan 2022, available at: https://www.documentcloud.org/documents/21179902-3rd-complaint-for-texas-google-antitrust-case.
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Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54; quotes at p. 19.
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Alphabet/Google cited in Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: Analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54.
- 35.
CMA (2020) Online platforms and digital advertising market study, UK Competition & Markets Authority, available at: https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study.
- 36.
Geradin, D. and Katsifis, D. (2020) “Trust me, I’m fair”: Analysing Google’s latest practices in ad tech from the perspective of EU competition law, European Competition Journal 16(1): 11–54; quote at p. 43.
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Birch, K. (2023). Data Enclaves. In: Data Enclaves. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-031-46402-7_5
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