Friday, 28 June 2019 11:45

ACCC set to hand digital platforms inquiry report to govt Featured

ACCC set to hand digital platforms inquiry report to govt Image by Gerd Altmann from Pixabay

ANALYSIS The competition watchdog is due to hand its digital platforms inquiry report to the government this weekend, with media companies keen to see what measures are outlined to reduce the threat posed to online journalism by the likes of Google and Facebook.

While the Australian Competition and Consumer Commission's launching of the inquiry was a lone exercise — only the European Union had uptil then taken any meaningful action to limit the domination of tech multinationals — the US is now set to launch its own anti-trust action against Google.

Facebook also faces action by the US Government and has been getting ready to pay as much as US$5 billion in fines for its numerous breaches of privacy.

Locally, the focus, for one, will be on whether the ACCC will mandate that these companies should pay for content from news publishers which they monetise. Though both Google and Facebook have paid lip service to helping journalism, both companies take a lot and give back nothing.

A recent study by the News Media Alliance, a group that counts about 2000 American publishers in its ranks, concluded that Google had made about US$4.7 billion in revenue from news content in 2018 for which it did not pay a single cent. The company contested this, calling it "back of the envelope calculations".

Facebook also benefits from news content and produces none of its own. Each month, about 19 million Australians use Google, 17 million access Facebook, 17 million watch YouTube and 11 million use Instagram.

The last time Sims spoke about the inquiry in public, he said he was seeking more data from the advertising industry about the preliminary conclusions he had reached.

“With an audience of this size, digital platforms are a primary channel for businesses looking to reach Australian eyeballs and, more importantly, their wallets. This is why this inquiry is important for Australian advertisers, and we welcome feedback from everyone with an interest," he said.

And in his preliminary report issued in December last year, Sims suggested that a regulatory entity, which could investigate and curb the influence of Google and Facebook, be set up.

That report also hinted that Google and Facebook, which earn about four-fifths of Australia's $8 billion digital advertising, could be involved in discriminatory conduct.

The EU has taken the lead in bringing the big tech giants to heel, and has already hit Google with three fines. In March, Google was fined for abuse of its AdSense advertising service, and told to fork out €1.49 billion (A$2.38 billion) for breaching EU anti-trust rules. In July last year, the EU fined Google €4.3 billion for allegedly breaching anti-trust rules over its Android mobile operating system. Google has challenged this fine.

In June 2017, Google was fined €2.42 billion for allegedly abusing its search engine dominance to give illegal advantage to its own comparison shopping service. The company has appealed against this fine too.

It remains to be seen what Sims will recommend, how, and when, the government will respond and whether any measures recommended are radical enough to make a difference. Else, it would all have been a waste of time.


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Sam Varghese

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Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.



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