Saturday, February 02, 2008

Microsoft takeover of Yahoo may be a major privacy battleground

Peter Swire takes a look at the proposed Microsoft takeover of Yahoo from a privacy perspective, at the Center for American Progress.

"Privacy issues will be central to the forthcoming antitrust merger review of today’s $44.6 billion bid by Microsoft Corp. for Yahoo Inc. U.S. antitrust authorities have already studied these privacy issues in connection with the proposed merger of Google Inc. and DoubleClick, which is still under review in Europe...

When it comes to the intersection of privacy and antitrust, the Google/DoubleClick merger will now look like a warm-up act for Microsoft/Yahoo. In the Google case, all five commissioners agreed with the central point of my testimony to the FTC this past October, in which I detailed why privacy can be an important non-price aspect of competition.

Commissioner Pamela Harbour cited my testimony in voting to block the merger. She recognized that antitrust law should ensure competition “based on privacy protections or related non-price dimensions.” The majority, while voting to approve the merger, agreed with the key point that privacy can be relevant to a merger, saying “we investigated the possibility that this transaction could adversely affect non-price attributes of competition, such as consumer privacy.”

The first message from the Google/DoubleClick merger review is that the FTC understands competition is not only about price. Competition has always included non-price aspects, such as the quality of goods. In the information age, a merger can shift practices from low-surveillance to high-surveillance."

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