“Everywhere these days, folks are talking about big data. (Apparently, even machines are talking amongst themselves using big data in an ecosystem called the Internet of Things.)  Last week, Chairwoman Ramirez spoke about the privacy implications of the big data revolution, and specifically, about the FTC’s law enforcement efforts to protect consumer privacy from the risks associated with the collection and use of consumer data. Recently, I was asked to discuss how competition law views big data, and relatedly, how privacy concerns might affect competition analysis. In an article entitled “Big Data in a Competition Environment (link is external),” I described how the agency has applied competition analysis over the years to examine the ways that firms compete using data as a product, an input, or a tool for making competitively significant decisions.  Big data may be a hot topic, but the use of data by businesses is not that new, and the FTC has applied standard competition analysis to data markets for many years. Broadly speaking, mergers involving competing data providers can present interesting, but not different, issues for competition analysis. For instance, market definition must account both for the dynamic nature of data, which must be updated and verified to retain its value, as well as the way that firms use data to compete. In some markets, data is the product—for instance, in the case of a database. In other markets, data is a key input, and firms compete to provide customized verification, analytics, or reporting to sophisticated customers. Similarly, entry conditions may be affected when incumbents have significant advantages over newcomers. For instance, the data involved may be publicly available, but existing firms may have developed sophisticated analytic techniques or gained a reputation for reliability that makes it difficult for new entrants or fringe competitors to challenge established competitors. In other cases, the data is not publicly available, and incumbents have a significant head start collecting and verifying data so that it would be difficult, costly, and time-consuming for a new firm to match the offerings of existing firms. Sometimes, the databases serve as a platform for buyers and sellers to meet, in markets where network effects can be difficult to overcome. Finally, the depth and scope of incumbents’ data stores may have implications for innovation—or, more precisely, how new or existing firms can access and use data to develop new products. What is new is the explosion in the collection and use of data about consumers, from their shopping habits to their sensitive health information. As more firms have extensive stores of consumer data, the work of the  Bureau of Competition and the work of the Bureau of Consumer Protection may converge – where a particular set of facts may raise both competition and consumer protection issues. On the competition side, the decisions firms make about consumer privacy can lead to a form of non-price competition, and the FTC has explicitly recognized that privacy can be a non-price dimension of competition. Although the FTC has yet to challenge a merger on the basis of a reduction in non-price competition over privacy protections, the cases the FTC has brought involving data markets clearly lay the foundation for that potential case. Nonetheless, any potential competition concerns would be distinct from the obligations either firm has to safeguard consumer privacy:  Take a look at “Mergers and privacy promises,” a blog post on BCP’s Business Center, to learn how to comply with consumer protection standards post-merger.”