Working Paper

Data Brokers Co-Opetition

Yiquan Gu, Leonardo Madio, Carlo Reggiani
CESifo, Munich, 2019

CESifo Working Paper No. 7523

Data brokers share consumer data with rivals and, at the same time, compete with them for selling. We propose a “co-opetition” game of data brokers and characterise their optimal strategies. When data are “sub-additive” with the merged value net of the merging cost being lower than the sum of the values of individual datasets, data brokers are more likely to share their data and sell them jointly. When data are “super-additive”, with the merged value being greater than the sum of the individual datasets, competition emerges more often. Finally, data sharing is more likely when data brokers are more efficient at merging datasets than data buyers.

CESifo Category
Industrial Organisation
Economics of Digitization
Keywords: data brokers, consumer information, co-opetition, data sharing
JEL Classification: D430, L130, L860, M310