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Facebook to Antitrust Regulators: Data Is Complicated

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12/02/2019 | 02:22pm EST

By Sam Schechner and Valentina Pop

BRUSSELS -- Facebook Inc. has a message for regulators and policy makers concerned about the company's harvesting of user information: don't treat data as a simple resource like oil.

Nick Clegg, Facebook's vice president of global affairs and communications, said Monday that antitrust officials should be careful not to treat data like other commodities that could be monopolized, but rather as something more complex that can be shared and kept at the same time.

"We think it is legitimate to ask profound questions about how data is held," Mr. Clegg said at a briefing with journalists on Monday. But he added that officials defining what he called the orthodoxy of competition policy should "reconfigure old concepts" and "relinquish themselves of the idea that [using data] is the same as using finite resources in finite, one-off ways."

Mr. Clegg's statement comes as tech companies including Facebook and Alphabet Inc.'s Google face growing antitrust scrutiny on both sides of the Atlantic for their control and use of user data. In the U.S., both the Justice Department and Federal Trade Commission are probing the companies.

The European Commission, the European Union's antitrust enforcer, is also in the early stages of probes into how both Google and Facebook gather and monetize data about their users for advertising purposes, according to a commission spokeswoman.

As part of those wide-ranging probes, investigators have sent out questionnaires to Google and Facebook competitors and business partners, such as advertising agencies, publishers and app developers, people familiar with the matter said.

"We use data to make our services more useful and to show relevant advertising, and we give people the controls to manage, delete or transfer their data," a Google spokesman said, adding that the company is in touch with EU officials.

Mr. Clegg declined to comment on any specific investigation, saying only that Facebook is cooperating fully with regulators and that the company believes its tools have helped small advertisers compete with larger ones.

In recent years Facebook and its chief executive, Mark Zuckerberg, have said that the company welcomes government efforts to regulate tech firms. On Monday, Mr. Clegg said new rules imposed by democratic governments could help the social media sector to restore its image, which has been hurt by scandals.

The conversation about competition and data is an increasingly prominent one. Smaller rivals have argued that after Google and Facebook have cut back on how they share data, it has made it more difficult for them to compete in the online-ad business. Google and Facebook say they are responding to public calls for stricter privacy controls, in particular the rules of the strict new EU privacy law, called the General Data Protection Regulation, or GDPR.

As pressure has mounted on Facebook, the company has become been vocal about wanting to offer its users tools to export their data from the company directly to competitors, and called for regulators to define how it should balance privacy with data access.

Facebook said Monday that it will soon allow its users to export their photos directly to Google's photo-sharing platform, without needing first to download and upload those pictures. The Facebook tool, which will launch first in Ireland and become global next year, is one of the first fruits of a joint project among tech companies including Apple Inc., Microsoft Corp. and Twitter Inc., to allow users to move around their data.

Mr. Clegg said that the photo tool is "the easy end of some of these decisions about how you transfer one service to another," adding that other information, such as one's friend lists, could raise more privacy concerns.

Data portability has gained attention after both the GDPR and a new privacy law in California created some new obligations for companies. Google and Facebook have offered some tools for users to download their data for many years. Still rivals say that it is hard for users to switch from one digital service to another -- a phenomenon described as lock-in.

Some critics were unsatisfied with Facebook's announcement on Monday.

"Data portability is a crucial feature in a thriving digital economy but Facebook's announcement falls short of creating the conditions for a more competitive social network market," said Agustin Reyna, head of legal and economic affairs at Beuc, an EU consumer-rights group. "This is a half-baked solution which will not make a significant change in the way people engage with social networks."

Write to Sam Schechner at sam.schechner@wsj.com and Valentina Pop at valentina.pop@wsj.com

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MICROSOFT CORPORATION -0.15% 151.13 Delayed Quote.48.79%
WTI 0.10% 59.1 Delayed Quote.29.85%
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