Search Engines and Data Retention: Implications for Privacy and Antitrust

This paper investigates whether larger quantities of historical data confer a competitive advantage to firms that offer Internet search. We study how the length of time that search engines retained their server logs affected the apparent accuracy of subsequent searches. Our analysis exploits changes in these policies prompted by the actions of the European Commission. We find little empirical evidence that reducing the length of storage of past search engine searches affected the accuracy of search. Our results suggest that the possession of historical data confers less of a competitive advantage than is sometimes supposed. Our results also suggest that limits on data retention may impose fewer costs in instances where overly long data retention leads to privacy concerns such as an individual’s “right to be forgotten.” JEL classification: L86