Why you should never sign DAT’s default agreement

This is an opinion piece by Craig Fuller, CEO and founder of both FreightWaves and SONAR.

DAT, the dominant leader in the load board business, has sneaked an abusive and predatory term into its agreements with clients. No one should ever sign DAT’s default agreement.

The urgency for clients to push back on DAT has exponentially increased now that the firm has acquired Trucker Tools, a leading truck matching platform.

In Section 2.5 of its terms and conditions, DAT states that, “Without Our written permission, you will not contribute rate data to any other service which (1) aggregates data for the purposes of providing trucking lane rates and (2) is reasonably deemed a competitive service by Us.”

Really, DAT?

You are telling clients they cannot share their own data with another vendor that you deem to be a competitor if they sign your default agreement.

First off, why would you do this to your own clients, especially the smallest players in the market, who lack the resources to hire legal services and fight this provision? After all, with your dominant position in the load board and matching business, few clients want to antagonize you for fear of potential retribution.

The larger players, with the scale and legal sophistication to demand that this provision be stripped from the agreement, tell us it is one of the most egregious requests they have ever gotten from a software partner.

Luckily for them, DAT has been known to drop this clause for clients that are deemed worthy. For the thousands of other customers who don’t meet the threshold of being strategically important to DAT, good luck.

How does DAT get away with insisting that clients don’t have the right to do as they please with their own data?

If DAT were not a dominant player in the load matching business (especially with its acquisition of Trucker Tools), which almost every broker depends on, the company’s position wouldn’t matter. Customers would tell DAT to pound sand, as there are far better data products out there that compete with DAT.

SONAR, Truckstop, Greenscreens and other emerging players offer a far wider range of offerings for clients, each having advantages over DAT’s rate offerings. None of them demand exclusivity from clients. After all, as a group, we view this practice as dangerous, predatory and potentially illegal.

The only reason DAT continues to be relevant in the rate business is not because of the quality of its data or its software, but because of its anticompetitive practices.

Clients should insist that this exclusivity clause be removed from their DAT contract. If DAT threatens clients with restricting their load board or capacity matching access, then you should file an antitrust complaint with the Federal Trade Commission (FTC).

And if for whatever reason, DAT insists the language is mandatory (a reminder that they view your business as too small to consider an exception they make for others), you should ask why they have so little confidence in the quality of their data and platform that they insist on restricting their clients’ ability to do what they want with their own data.

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