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Big data and Innovation: Implications for Competition Policy in Canada

Competition Bureau Canada, Draft Discussion Paper, September 2017

See Canada's Competition Bureau's resume

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Prognosticators have been describing the promises and threats of big data for several years now. Under one view, algorithmic analysis of big data has the potential to become “a key basis of competition, underpinning new waves of productivity growth, innovation, and consumer surplus.” Others have described it as a potentially serious threat to democracy and even to the survival of the human race. Competition practitioners have also jumped into the debate with a similarly varied set of predictions. Some hold that big data offers substantial benefits to both individuals and businesses; others hold that it has the potential to undermine the competitive process.

This paper does not offer predictions about what the ultimate effect of big data on competition will be. However, it does recognize the role that competition policy can play in tipping the scales one way or the other. For example, an uninformed or overly interventionist enforcement approach risks chilling investment in the accumulation and use of big data through legitimate means, and losing out on significant benefits to competition and innovation. On the other hand, an approach that is too lax risks turning a blind eye to uses of big data that are harmful to competition and consumers. One goal of this discussion paper is to prompt discussion on how the Competition Bureau (Bureau) should strike a balance in enforcing the Competition Act (Act) in cases involving big data. To facilitate this discussion, the Bureau is soliciting public comments on its website. The Bureau plans to release a concise summary of important insights informed by these public comments in the near future.