In December 2019, the Department of Justice launched an investigation into Google’s proposed acquisition of FitBit, causing many antitrust practitioners to question how Google would use sensitive health information, such as activity and fitness levels, heart rates, sleep patterns, friend lists, locations, and other personal information, alongside its own trove of online data.
Such commentary was part of a trend of increased skepticism toward “Big Tech,” exemplified by the FTC’s creation of the Technology Enforcement Division and its more recent order to Amazon, Apple, Facebook, Google, and Microsoft to turn over a decade’s worth of material on transactions that did not require pre-merger notification under the Hart-Scott-Rodino Act.
While the Google-Fitbit investigation proceeds with a second request review, it is worth considering how the Covid-19 pandemic will affect antitrust enforcers’ views of data-driven acquisitions moving forward. Indeed, in just three short months, emerging commentary has focused on the potential public health uses for big data. Given that, one may now wonder whether a shift is set to occur as the public finds these companies more necessary than ever.
Contact Tracing Apps
On April 10, Google and Apple announced plans to help software developers create epidemiological contact tracing applications. Already being rolled out, Google and Apple are enabling their operating systems (which cover almost all smartphones in the U.S.) to use Bluetooth technology to log “contacts” with other application users.
To minimize privacy concerns, each individual user’s contact log is to be stored on that person’s smartphone, as opposed to a central database. According to the companies, “[t]his system does not collect location data from your device, and does not share the identities of other users to each other, Google or Apple.” An application user who tests positive for Covid-19 can then notify public health officials, who in turn notify application users who came into contact with the verified positive patient, effectively tracing that person’s contacts.
While there are questions about whether Bluetooth will be able to distinguish between epidemiologically significant contacts and mere proximity, as well the efficacy of a program based on the voluntary participation of smartphone users, the establishment of such a program nevertheless depends on (1) the ubiquity of Google and Apple’s cellphone operating systems and (2) the ability of Google and Apple to gather data.
Conundrum for Antitrust Enforcers
Such a program presents a conundrum for antitrust enforcers with regard to big data and data-driven acquisitions. Just three months ago, antitrust news outlets showcased the DOJ’s investigation into proposed Google-Fitbit merger as mounting evidence of a greater concern for the mass accumulation of data, particularly when it relates to sensitive health information. But, now in a world of Covid-19, is it possible to see big-tech and big data in a new light?
To alleviate privacy concerns in the epidemiological contact-tracing program, Apple and Google have stated that they will not store data, instead leaving it decentralized on user phones. Alabama, South Carolina, and North Dakota plan to use the technology, and other separate efforts are also underway. Yet privacy is a concern.
For example, Apple was responsible for vetting a separate joint North Dakota and South Dakota application which was later found to be sharing data with a third party. Utah’s application, meanwhile, seeks personal identification information and location data, information the tech companies have been hesitant to catalogue.
Sharing information with some corporate or government entity, however, may be inevitable, as many believe technological tracing is at best a supplemental program. In other words, it is hard to imagine an effective epidemiological tracing program without the mass accumulation of data in at least some hands.
Public Health Benefits
One of the ways Fitbit has tried to alleviate similar privacy concerns regarding its acquisition by Google is by stating that it will not sell its data or allow Google to incorporate its user data into advertisements; however, one can imagine numerous other uses for which Google might utilize Fitbit’s data.
If one of these uses were to promote the efficacy of Bluetooth-based contact tracing, would this use make the merger more acceptable to regulators? Indeed, it is not hard to imagine Google using Fitbit data alongside its own preexisting trove to identify public health risks, especially considering that Fitbit is already trying to develop an algorithm to detect Covid-19 before symptoms start.
When viewed from that perspective, the big tech companies may have significant leeway for future data-driven acquisitions; collecting more data (or increasing a company’s ability to collect more data) may have a public health benefit.
Antitrust enforcers should keep in mind that antitrust law is generally agnostic towards public health justifications. See FTC v. Indiana Fed’n of Dentists, 476 U.S. 447, 462 (1986) (rejecting “‘quality of care’ justifications” for defendants’ anticompetitive conduct); Nat’l Soc’y of Prof’l Engineers v. United States, 435 U.S. 679, 695 (1978) (recognizing “[t]he fact that [defendants] are often involved in . . . projects significantly affecting the public safety does not alter [the Sherman Act] analysis”). In their March 24 joint statement, the FTC and DOJ recognized the need for corporate cooperation in fighting Covid-19 while reminding potential collaborators that the pandemic does not provide an excuse to violate the antitrust laws. Absent a specific invocation of the Defense Production Act, the same rules apply and the need for enforcement remains urgent.
As Covid-19 shifts more and more aspects of everyday life online, tech companies are gaining increasingly more data, only increasing the importance of this issue. Indeed, many expect the big tech companies to emerge from the pandemic stronger than before, presenting an even greater challenge for antitrust enforcers.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.
Meegan Hollywood is a partner and Adam C. Mendel is an associate in Robins Kaplan’s antitrust and trade regulation group in New York. They prosecute complex antitrust actions involving price-fixing, unlawful monopolization, and other anti-competitive practices.
The views expressed herein are the authors’ own and do not necessarily reflect those of any client, employer, or colleague.