Time to look beyond consumer price increases in M&As, say experts

The competition bureau is “flying blind” when it comes to understanding the cumulative effects of mergers—such as the proposed Rogers Communications Inc. acquisition of Shaw Communications Inc.—according to policy experts who testified before the House of Commons’ Industry committee Thursday as it continued its study on competitiveness in Canada. “Competition policy reviews should go beyond assessing consolidation solely in terms of price increases to consider, for example, standards of data and privacy protection,” director of the Canadian Media Concentration Research Project Dwayne Winseck told the committee. Winseck said apart from concerns that a Rogers-Shaw merger could up prices for consumers, there is also concern the companies will be merging their data on their subscribers across their mobile wireless services, internet services, and cable television services. “They have aggregated a great deal of data on their subscribers and their audiences and right now the entire industry is trying to rush to accumulate as much data and integrate it across as many services as they can so as to better compete with the Googles and Facebooks of the world,” he said in a follow-up interview with The Wire Report. Winseck said merging the Rogers and Shaw consumer data will create a honeypot for hackers and can also move the companies to become “powerful opponents” of stronger privacy and data protection policies. He noted to the committee that Facebook went down a similar path during the competitive era for social media when it “loudly touted its respect for people’s expectations about trust and privacy when it competed with tens of other rivals.” He said since its acquisition of Instagram and WhatsApp, however, “it has systematically degraded the standards of privacy and data protection it offers.” Winseck also told the committee that he was “struck” by last week’s hearing on the merger where the Commissioner of the Competition Bureau, Matthew Boswell, said the bureau did not have the legislative mandate or resources necessary to assess mergers for compliance after the fact. Vass Bednar, executive director of the Master of Public Policy and Digital Society program from McMaster University, echoed similar concerns to the committee, and said that Canada's Competition Bureau had no toolkits in place for dealing with the digital economy which is concerning because “issues on data collection and processing are at the centre of current antitrust cases all around the world.” She noted she was “struck by the lack of scholarship” that can help redefine what market dominance means in the digital age having found most research on the subject published directly from government officials or from private actors states that “there's not a whole lot of material that sits in a neutral middle ground.” “Canada’s competition policy no longer serves our best interests and digital markets are fundamentally different from traditional ones. This alone warrants modernising the alongside more robust privacy legislation in order to better manage these issues and truly promote dynamism. Otherwise, companies will continue to trade on personal information,” she told MPs. Bednar said some of the items in the Act that need changing are the ‘seemingly arbitrary” thresholds for a merger review so the bureau does not potentially overlook anti-competitive mergers, increasing the maximum penalties for anti-competitive behaviour, reevaluating the efficiencies defence, and acting as anticipatory regulators that can spot harms of digital competition. — Reporting by Jenna Cocullo at jcocullo@thewirereport.ca and editing by Hannah Daley at hdaley@thewirereport.ca

Time to look beyond consumer price increases in M&As, say experts

News | April 15, 2021

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Time to look beyond consumer price increases in M&As, say experts

News | April 15, 2021

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