Is Facebook and Google’s free ride over? ACCC prepares to get tough

Published on the 28/02/2018 | Written by Jonathan Cotton


Australia’s competition watchdog is taking a long hard look at how digital platforms - and the companies that dominate them - are affecting society...

The ACCC is gearing up for a confrontation with digital platform giants such as Facebook, Google and Apple with a new probe into the affect the technology giants are having on Australian culture.

The group is calling for submissions into the market power of digital platforms – including search engines like Google, content aggregators like Apple News and social media platforms like Facebook – and the implications of those platforms for media content creators, advertisers and consumers.

The enquiry is the first of its kind in the world, with the consumer group stating that it’s looking to get some tough questions answered. Among those questions, whether digital platforms like Facebook have excessive bargaining power in their dealings with content creators, advertisers and consumers and the implications of that bargaining power; how the use of algorithms is affecting the presentation of news for digital platform users, and the extent to which consumers actually understand what data is being collected about them by digital platforms like Google, and how that information is used.

And it really does look as though the consumer watchdog is gearing up for a fight. The group says that, like it or not, Google and Facebook will hand over its data, announcing Monday that “the ACCC will use its compulsory information gathering powers to obtain information from digital platforms and media organisations that is not publicly available”.

“Like it or not, Google and Facebook will hand over its data”

“Digital platforms like Google and Facebook are part of the sweeping technological and cultural changes overhauling the media landscape in Australia and globally,” ACCC Chairman Rod Sims said.

“While these technological changes have brought many benefits for consumers, this inquiry will have a particular focus on examining whether the changes affect the quality and range of news supplied to Australian consumers.”

“Considering the longer term impacts of digital platforms and the ability of traditional media to remain financially viable will also be key to understanding the media and advertising markets,” Sims said. “Our aim is also to understand better the digital platforms’ business models and how they operate behind the scenes, and the evolving nature of the way consumers search for and receive news in Australia. We are particularly interested in the extent to which digital platforms curate news and journalistic content.”

Last year’s review of the state of public interest journalism in Australia ruled there was insufficient evidence of Facebook and Google’s impact on local media. The new paper however notes that Google currently provides 95 percent of digital search service in Australia, and along with Facebook both companies account for 40 percent of all advertising revenue, including about three quarters of online ad revenue.

Given that players like Google and Facebook are subject to little regulation in Australia – not to mention the companies’ regular run-ins with the Australian Taxation Office – a forensic review of the way big tech business is being done here is surely overdue.

A preliminary report on the findings is scheduled for 3 December 2018 and a final report on 3 June 2019. Submissions in response to its issues paper are being sought now, deadline 3 April 2018.

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