ACCC muscles up to Facebook

James Riley
Editorial Director

Australia’s competition and consumer watchdog will use its compulsory information gathering powers to obtain data from tech giants including Google and Facebook as part of its wide-ranging “world-first” inquiry into news and digital platforms.

The ACCC will consider direct regulatory intervention and recommendations to government for legislative change as part of the inquiry into the impact of digital platforms on competition in media and the advertising services market.

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It will also zero in on how digital platforms like Facebook create “filter bubbles” where users aren’t exposed to new information or differing views, and a lack of transparency over the data that is gathered by these global companies, and how it is used.

Late last year the Australian government ordered the ACCC to undertake a public 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”.

On Monday, the ACCC revealed its key issues paper for the inquiry, and began accepting submissions on the matters from consumers, media organisations, digital platforms, advertising agencies and advertisers.

In the issues paper, the ACCC confirmed that it would make use of compulsory information gathering powers to “obtain information from digital platforms and media organisations that is not publicly available”.

“We’ve had good meetings with Facebook and Google, but how much we get everything we need we’ll have to see,” ACCC chair Rod Sims told ABC Radio National.

“Of course we’ve got compulsory information gathering powers if we need them. The ACCC has the power to serve a notice that compels companies to provide certain information and it’s a criminal offence not to do so.”

These powers can be used by the ACCC to require the relevant companies to provide necessary information and documents – or to give evidence under oath – or be faced with serious penalties.

Mr Sims said the inquiry would focus on the negative impact of the rise of digital platforms.

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

“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.”

He said that the ACCC’s information gathering powers would be used to gain data on how digital platforms like Facebook operate, and the underlying business models that may impact competition in the space.

“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,” he said.

“We are particularly interested in the extent to which digital platforms curate news and journalistic content.”

The inquiry would consider whether the ACCC should take action on the issues, or if it should recommend legislative changes to the federal government.

“We can make recommendations to government or we can take action under our Act. Keep in mind they are clearly doing business in Australia which means they are clearly caught by our Act and will be subject to any Australian legislation,” Mr Sims said.

The 39 page issues paper outlines the five key areas the ACCC is seeking feedback on:

  • Whether digital platforms have bargaining power in their dealings with media content creators, advertisers or consumers and the implications of that bargaining power
  • Whether digital platforms have impacted media organisations’ ability to fund and produce quality news and journalistic content for Australians
  • How technological change and digital platforms have changed the media and advertising services markets, and the way consumers access news
  • Extent to which consumers understand what data is being collected about them by digital platforms and how that information is used
    How the use of algorithms affects the presentation of news for digital platform users

For the purpose of the inquiry, the digital platforms are narrowed down to “those that may impact on competition in media and advertising services markets, particularly in relation to the supply of news and journalistic content”.

These are platforms that provide media content, social interaction or search functionality to attract users, and then sell access to these users to advertisers.

The digital platforms to be investigated include Google, Facebook, Instagram, Twitter, Snapchat and Apple News.

The issues paper identifies a number of areas that the ACCC is already concerned about, including the impact of the reduction in media companies’ advertising revenue on the creation of new content, the impact of the collection of consumer data and algorithmic selection and a reduction in funding.

The inquiry will look at the associated loss of privacy with this data collection, and whether services like Facebooks are providing users with “adequate levels of privacy and data protection”.

“Across a number of platforms, consumers are required to provide wide-ranging consents regarding the collection and use of their data in order to use the platform and it is important that they are supplied with adequate information on this data collection and use in order to be able to provide informed consent,” the issues paper said.

The ACCC will be seeking information on this use of advanced algorithms to deliver targeted content to users, and the potential for “filter bubble”, along with the impact of this on diversity in news.

Do you know more? Contact James Riley via Email.

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