DENHAM SADLER
July 4, 2018

ACCC platforms inquiry heats up

Media

ACCC platforms inquiry heats up

New friction: ACCC will determine if curbs are needed on digital platforms' profits

Australia’s “world-first” inquiry into the impact of digital platforms on the media is looking to address “one of the defining questions of our age”, the government's competition tsar said.

Addressing the International Institute of Communications’ Telecommunications and Media Forum in Sydney on Tuesday, Australian Consumer and Competition Commission chair Rod Sims outlined the importance of its current Digital Platforms Inquiry in the context of global focus on data use and the power of Google and Facebook.

“The question of how we approach the proliferation of digital platforms, and how they collect and manage our data, is one of the defining questions of our age,” Mr Sims said.

“Technology changes things, and the way that we respond to technological change can dictate much of our future success. It is important that we take the time to get the answers right."

Late last year the federal government directed the ACCC to launch an inquiry into the “impact of digital platforms on competition in media and advertising services market, in particular in relation to the supply of news and journalistic content”.

The inquiry is looking into the impact of Google, Facebook and other digital platforms on competition in the media markets, the market power that these global giants have and how quality journalism is impacted by this.

The inquiry is likely to lead to direct regulatory intervention along with recommendations to government for legislative change.

Mr Sims the inquiry is looking to answer four key questions, centred on the market power of these digital platforms, their transparency in the collection and use of consumer data, the platforms’ potential unfair competitive advantages and the impact they have had on Australian media and advertising companies.

In the speech, Mr Sims looked to place the ACCC’s inquiry in an international context, encouraging other governments from around the world to also look into the “global issue”.

“It is important that governments examine the role these companies are playing in society, and, as with other companies, determine if policies are needed to curb their pursuit of profit given the problems such pursuit will cause,” he said.

“The growth of digital platforms and their immense data gathering represents something new that has not been previously encountered in the entire span of human history.

"It is little wonder that governments, businesses and individuals are grappling with this seismic shift. It is truly unprecedented, and it must be better understood.”

The issues the inquiry is looking to address “will only grow in important”, and have become even more relevant following the Facebook and Cambridge Analytica data harvesting controversy earlier this year, he said.

“If the accusations levelled at Cambridge Analytica are true, and the data of millions of users was used to affect the outcome of the US election, then we have reached the stage where digital platforms can affect the course of nations,” Mr Sims said.

Australian consumers are generally not aware of the types of data these companies collect and how it is used, Mr Sims said.

“We do not believe that consumers are generally well-informed about how digital platforms collect and use their data.

"The issue is not just about the wording of a privacy policy. We will be also examining whether users appreciate the value of the data they are providing to these platforms, both when they are using these platforms, and also when they are not.

"In other words, are users ‘selling’ their data too cheaply in exchange for convenience?” he said.

The inquiry will also be looking at whether these digital platforms should be subject to defamation and copyright laws in the same way that media companies are.

It will be looking at the impact on quality journalism in terms of how the reduction in advertising revenue has prevented publishers from delivering “investigative, verified and diverse journalism”.

“Journalism is a highly valued profession, and crucial to our lives. Just like we are well advised not to rely on amateur doctors, perhaps we should not rely on amateur journalists,” Mr Sims said.

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