If it isn’t privacy, it will be competition

Posted by on June 1, 2018  /  0 Comments

We’ve been talking about competition as one of the major policy issues in the data analytics space. But this is an angle we had not thought about: China.

Still, with the European Union enacting tough new privacy laws, and some in the United States eager to follow, Google and Facebook could soon be forced to find ways to make money beyond selling users’ personal information to advertisers, said Raj Rajgopal, president of digital business strategy at Virtusa Corporation, a consulting firm.

“As profitability reduces, they’ll say, ‘Now I need to monetize my customer base,’” Mr. Rajgopal said. “The innovation we’re seeing in China could be seen in the U.S. in the next three to five years,” he added. “Customers are demanding that.”

China’s internet titans have a powerful ally found nowhere else, though: the Chinese government. Tencent and Alibaba have avoided antimonopoly clampdowns by staying in Beijing’s good graces, said Hu Wenyou, a partner at the Beijing law firm Yingke. Their sheer size also makes them easier for the authorities to control. They simply have too much to lose.

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