In the December 11 Law360 article “Privacy, Not Price, Takes Focus In Facebook Antitrust Suits,” AAI’s Diana Moss discussed the “landmark” Facebook case.
From the article:
“They are absolutely avenues through which consumers can be harmed. It’s not just paying higher prices,” said Diana Moss, president of the American Antitrust Institute, which advocates for rigorous competition enforcement. “It’s also getting lower quality”
Moss said the allegations have created “a landmark case,” one that could play an important role in how courts consider the consumer welfare standard used in the United States to judge if conduct is anti-competitive. In recent decades, Moss noted, courts have employed the welfare standard “through a very narrow lens” focused on short-term static price increases.
Moss argued that just because non-price effects are typically bundled in with allegations of price impacts doesn’t mean they can’t stand on their own.
Non-price effects are particularly important for suits like the one against Facebook, a company whose primary product is offered free of charge in exchange for personal data and advertising eyeballs.
While Moss argued that the emphasis on non-price effects should have no bearing on the likelihood of success, others say the plaintiffs face higher hurdles in proving their arguments.
The court, according to Charles Koch Institute senior research fellow and former chief FTC technologist Neil Chilson, will have to gauge the “alternative world” of what would have happened if not for Facebook’s monopolistic strategy.
“The government will have to demonstrate that, in the absence of these mergers, consumers would have better choices around privacies,” Chilson said. They’ll also have to prove “that those choices would have mattered to consumers in a way that was competitively significant.”
