テクニカルレポート

ディスカッション／ワーキング・ペーパー

text

Institute of Social and Economic Research Discussion Papers. 2020, 1108, p. 1-14

Data-Driven Mergers and Personalization

The Institute of Social and Economic Research, Osaka University

英語

text

2020-11

https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2020/DP1108.pdf

Recent years have seen growing cases of data-driven tech mergers such as Google/Fitbit, in which a dominant digital platform acquires a relatively small firm possessing a large volume of consumer data. The digital platform can consolidate the consumer data with its existing data set from other services and use it for personalization in related markets. We develop a theoretical model to examine the impact of such mergers across the two markets that are related through a consumption synergy. The merger links the markets for data collection and data application, through which the digital platform can leverage its market power and hurt competitors in both markets. Personalization can lead to exploitation of some consumers in the market for data application. But insofar as competitors remain active, the merger increases total consumer surplus in both markets by intensifying competition. When the consumption synergy is large enough, the merger can result in monopolization of both markets, leading to further consumer harm when stand-alone competitors exit in the long run. Thus there is a trade-off where potential dynamic costs can outweigh static benefits. We also discuss policy implications by considering various merger remedies.

77671

Data-Driven Mergers and Personalization

The Institute of Social and Economic Research, Osaka University

英語

2020-11

Institute of Social and Economic Research Discussion Papers

1108

1

14

https://hdl.handle.net/11094/77671

https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2020/DP1108.pdf