Watchdog to curb power of Google and Facebook
BRITAIN i s taking on Google, Facebook and other tech giants with the world’s first watchdog to prevent them abusing their dominant positions.
The Digital Markets Unit will be given muscular powers to protect smaller businesses and to ensure that consumers have more control over their online profiles.
While its precise remit has not been defined yet, it could be able to levy large fines to stop customers or companies being treated unfairly, and make leading online firms give smaller rivals access to their vast troves of data.
It may also have powers to suspend, block or even reverse decisions made by tech companies.
The unit, which starts work in April, is expected to become fully operational by 2022. Legislation allowing it to legally enforce its rulings is expected to be debated in Parliament’s next session.
It will be part of the Competition and Markets Authority ( CMA), which has called for stronger powers after warning that Google and Facebook held ‘unassailable’ positions in digital advertising and social networking that threatened fair competition.
The two companies command 80 per cent of Britain’s £14billion digital ads market between them, the CMA found, while Google controls 90 per cent of the search market. But today, the Government will vow to address the regulator’s fears to ensure ‘consumers and small businesses aren’t disadvantaged’.
Ministers are particularly concerned that online platforms abuse their market dominance to impose unfair business terms on news publishers, threatening their ability to give the public high-quality news.
Culture Secretary Oliver Dowden said: ‘I’m unashamedly pro-tech, and the services of digital platforms are positively transforming the economy – bringing huge benefits to businesses, consumers and society.
‘But there is growing consensus in the UK and abroad that the concentration of power among a small number of tech companies is curtailing growth of the sector, reducing innovation and having negative impacts on the people and businesses that rely on them.
‘It’s time to address that and unleash a new age of tech growth.’
Business Secretary Alok Sharma
‘Cornerstone of democracy’
added: ‘ The dominance of just a few big tech companies is leading to less innovation, higher advertising prices and less choice and control for consumers.
‘Our new, pro-competition regime for digital markets will ensure consumers have choice, and mean smaller firms aren’t pushed out.’
In a report in July, the CMA warned that Facebook and Google had become so dominant over digital advertising that rivals could not ‘compete on an equal footing’.
The watchdog said vast amounts of data amassed by the firms gave them an ‘unmatchable’ and growing advantage over competitors, while both also constantly ‘nudge’ people towards their own services to gain control over yet more data.
In the case of advertising, it warned that this dominance could force businesses to pay more than they would have done if there was more competition. The CMA said this allowed Google and Facebook to take a bigger share of ad revenue from newspaper publishers, which rely on the tech giants to attract visitors to their websites, making it harder for them to survive.
Mr Dowden said a free Press was ‘the cornerstone of democracy’, adding: ‘As more and more news moves online, we want to make sure our world-renowned publishers get a fair deal from the tech platforms so we can help guarantee their long-term sustainability.’
Andrea Coscelli, CMA chief executive, said; ‘ Only through a new pro-competition regulatory regime can we tackle the market power of tech giants like Facebook and Google and ensure that businesses and consumers are protected.’