Friday, September 3, 2021
This paper describes the role that data portability and interoperability measures can play in promoting competition both within and among digital platforms. In particular, these measures can address consumer lock-in, promote unbundling, and enable multi-homing. However, they will not be effective in every market, and in some cases may unintentionally hamper competition.
The implementation of portability and interoperability measures with regards to digital platforms is still limited in some cases, and at its early stages in others. However, these limited experiences point to some lessons learned. In particular, the objective of portability and interoperability measures matters. When implemented with objectives other than competition (such as data protection), these measures may not have procompetitive impacts unless designed with market dynamics in mind. Further, these measures may have unintended consequences if they create new entry barriers or entrench incumbent technologies. In addition, implementation mechanisms will be determinative of the effectiveness of these measures; for example, competition authority or independent third party oversight may be needed to set interoperability standards and adjudicate disputes.
Looking forward, the competition concerns motivating data portability and interoperability may be observed in a growing array of sectors, ranging from automobiles to finance. Promoting competition in the design of these measures, or proposing their implementation in order to encourage competition, may therefore be of increasing importance for the competition policy community.