Facebook and Google face another costly battle

EU’S view is that free social media is not a public good if its business model hoovers up user data without consent

rebut this view, insisting that a disruptive rival could unseat them anytime. But regulators have given up waiting for one.

The recipe for fixing things, according to Buttarelli, is threefold. He wants more competition through antitrust enforcement, more data protection through GDPR, and more fairness and transparency for customers from the tech giants themselves.

None of this would destroy Facebook or Google. GDPR is estimated to have inflicted a negative impact of 2-3% on the two companies’ total ad revenues, according to Bank of America analyst Justin Post. The running total of EU antitrust fines against Google is about 6.7 billion euros ($7.5 billion), while the company’s yearly sales are more than $100 billion. Still, Eric Leandri, co-founder of French search engine Qwant, says he’s confident that fines against Google on competition and data-privacy grounds – which the US firm is appealing – will have a chilling impact.

Defenders of the Silicon Valley faith will grumble about mission creep in Brussels. It’s true that regulators need to be careful not to muddy the waters with inconsistent regulation. The recent German competition ruling against Facebook uses data privacy as its main argument, but without a prior ruling on GDPR infringement.

That’s a problem because it’s hard to separate the need to enforce user privacy with the need to safeguard competition. Imagine the right to keep your data private under one law alongside the need to share your data in a competitive market under another.

Another thing not covered in Buttarelli’s plan is where investment comes from. It was no surprise when Sweden’s music-streaming giant Spotify Technology SA decided to list its shares on the New York Stock Exchange last year. If Europe fails to unify its fragmented capital markets, especially after Brexit, the fruits of Buttarelli’s labour will end up in America regardless.