Big Data and Network Effects of Facebook: Critical Analysis of Indian and German Competition Commission

Abstract

Network effects play a very important role in any platform market. Same applies to social networking sites and messenger like Facebook and WhatsApp. It has so become a part and parcel of people’s and businesses’ life that it is nearly inevitable to avoid these. All the credit for this goes to network effects. However, these larger than life platforms are worthy of attention from Anti-trust regulators and call for an immediate policy change because of the large scale data they are acquiring making them capable of not just acquiring a dominant position, but of easily abusing the same. Recent acquisitions by Facebook of widely used sources of data like Instagram and WhatsApp and subsequent changes in their privacy policy are another wake-up call for Competition law authorities. The case has been examined in Indian as well as German courts. This paper tries to draw a comparison between the analysis of different Anti-trust authorities in order to find out what might be the crucial element that they have missed. It tries to suggest an approach that can help in dealing with this expanding peril.