Horseracing Databases and Memory Technology – What is a Fair Price?

Two recent decisions demonstrate how competition legislation can affect the pricing conduct of companies with interests in data and IT. They are summarised briefly below.

In late 2006, the Court of Appeal was asked to decide whether prices charged by the British Horseracing Board ("BHB") for access to pre-race data were excessive. Of most interest to companies in the IT industry is the question of when a price charged by a dominant company for access to information or other assets that it controls may be excessive so as to infringe competition law.

The trial judge had concluded that the prices charged by the BHB to Attheraces ("ATR") were so far in excess of the cost of compiling the data and creating the database as to be clearly excessive. He suggested that a price would be excessive if it was significantly in excess of the economic value of the asset. He held that the "economic value" could be assessed by measuring the cost of production (here, the cost of