To break up monopolies in the digital era, antitrust legislation should ensure data portability from sites such as Facebook–10.09.2017

Imagine waking up one morning and using your, say Airtel, mobile to call a friend. The call fails and an automated voice tells you that you cannot call anyone on a different network. Horrified, you run to an Airtel store to quit the service but the shop assistant says you will lose the phone number you’ve used for decades if you do that.

The absurdity of this skit is the reality of social media today. Social media users cannot communicate across platforms. If they don’t like a service, the fear of losing their entire digital networks renders them captive consumers. This also hurts competition as startups offering new features cannot compete with established firms. It is time social media is better regulated to protect consumers and encourage competition.

Six years ago, Prime Minister Manmohan Singh introduced mobile number portability so users could take their mobile numbers with them to a different network. In January alone, more than 6 million people used that right to switch networks. The threat of losing customers has sparked competition leading to lower prices and better services. Now, social media users should also get to take their data with them to rival firms and communicate across different sites.

In July, Facebook announced a 71% increase in global profits and India is one of its fastest growing markets. A lot of its success is well deserved and users now spending an average of 50 minutes a day on its platforms. But, is Facebook also profiting from locked-in users?

A “network effect” exists when current users of a product or service gain when others adopt it. Facebook is a great place for sharing updates and photos because so many others use it. If more people join, current users are better off. But this also increases the cost of switching. If you leave, you lose all your posts and online networks.

Captive consumers are often underserved and sometimes, even open to abuse. Without asking permission or even telling its users, Facebook manipulated users’ News Feeds – the list of photos and status updates you see when you open the site – to see if it could make users feel happier or sadder. Consumers and ethical experts were obviously outraged. Now, would Facebook have run this experiment if it really feared losing its customers?

Captive consumers also hurt competition. Even with great features, startups would be asking people to give up entire digital networks and histories. And because most social media platforms don’t allow users to communicate across sites, you need a critical mass of defections before a new site becomes a feasible alternative. That is a tall order.

So, why are regulators silent? Their pre-digital tools like price controls and antitrust have proved impotent. The price for using social media is personal data and it’s hard to apply antitrust rules when you do not know what industry a firm belongs to: When Facebook bought WhatsApp, the deal was seen as an advertising firm buying a messaging app when in fact Facebook was deepening its consumer base.

But this is changing. Japanese regulators now admit there is a need for new competition laws and the EU has a new law which ensures data portability. With more than 241 million Facebook users, India should also implement new protections.

Data portability is the idea that consumers should be able to take their data with them if they leave one platform for another. So, Facebook users should be able to take their posts and network with them to other sites. This would make it easier for consumers to change sites the same way phone number portability allows network switching.

Data portability alone, however, is not enough. Users should also be able to contact people on another platform the same way they can call people on a different cell network. Freedom to communicate across platforms is critical to making the freedom to move meaningful.

Social media is essentially a communications service. Phone companies have to provide portable numbers and inter-operability. Social media firms should do the same.  To make this happen, regulators need to implement data portability and inter-operability. A rising tech hub like India should take the lead in ensuring competition and consumer choice in technologies of the future.

via To break up monopolies in the digital era, antitrust legislation should ensure data portability from sites such as Facebook

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