Just over a century after the U.S. Supreme Court ordered the dissolution of John D. Rockefeller's Standard Oil monopoly, the world's most valuable commodity has shifted from fossil fuels to data. In 2017, five technology companies—Alphabet, Microsoft, Amazon, Facebook, and Apple—have become the most valuable firms globally, amassing a combined first-quarter net profit exceeding $25 billion, according to The Economist.
The rise of these tech juggernauts mirrors the era that prompted antitrust legislation, when extreme wealth inequality led lawmakers to curb monopolistic control over critical resources. Today, however, the resource in question is intangible: data. Unlike oil, data is not depleted by use; it can be extracted endlessly, refined through evolving algorithms, and traded in dynamic markets. This fundamental difference challenges the very basis of traditional antitrust law, which was designed for industrial-age monopolies.
The scale of data's economic impact is staggering. Amazon captures nearly 50 cents of every dollar spent online in the U.S., while Facebook and Google together accounted for almost all digital advertising revenue growth in the country in 2016. These companies leverage data to enhance their services—for instance, Facebook's facial recognition technology uses user-tagged photos to improve AI capabilities—creating a cycle that reinforces their market dominance.
Ownership of data remains a murky legal area, and the tech giants are far ahead of regulators and consumers in exploiting it. As The Economist notes, the sheer size and success of these companies is not inherently problematic; their services often come at low or no monetary cost, paid for instead with personal data. Yet, the concentration of data control grants these firms enormous power, raising concerns that traditional antitrust tests—even the more liberal ones applied in the European Union—may not adequately address the risks.
Why Traditional Antitrust Falls Short
The concept of "network effects" insulates large tech companies from competition, as smaller rivals lack the data needed to develop equally competitive products. Moreover, when a potential threat emerges, dominant firms can acquire it before it matures into a real competitor—Facebook's $19 billion purchase of WhatsApp being a prime example. Such moves, while perhaps justifiable under current rules, signal the need for a new regulatory lens.
The Economist proposes two key reforms: first, antitrust assessments should consider data implications, such as the volume of data a merged entity would control and unusually high acquisition prices as potential indicators of anti-competitive intent. Second, regulators should act as transparency watchdogs, compelling companies to disclose what data they collect and why, while ensuring consumers and third parties have easy access to that data.
However, political will appears lacking. Recent government decisions suggest that the FCC and Congress are unlikely to support such sweeping changes to antitrust law. As the data economy continues to evolve, the question remains whether existing legal frameworks can adapt—or whether the concentration of data power will redefine wealth and corporate influence in America, much as oil did a century ago.
