Dig­i­tal gi­ants to face data checks

The Weekend Australian - - FRONT PAGE - GREG BROWN

Face­book, Google, Ap­ple and other dig­i­tal gi­ants will be forced to ex­plain how they use the data of con­sumers for highly per­son­alised ad­ver­tis­ing un­der an 18month in­quiry by the com­pe­ti­tion watch­dog.

Josh Fry­den­berg has di­rected the Aus­tralian Com­pe­ti­tion & Con­sumer Com­mis­sion to shine a light on how in­ter­net in­for­ma­tion is shared with ad­ver­tis­ers, and whether the ads are pro­vid­ing value for money for busi­nesses.

Dig­i­tal gi­ants will be com­pelled to hand over ad rev­enue data and the amount charged to busi­nesses to pro­mote prod­ucts on their plat­forms.

The in­quiry’s terms of ref­er­ence also give ACCC chair­man Rod Sims the power to as­sess how the mar­ket power of dig­i­tal firms af­fect the sup­ply of ad op­por­tu­ni­ties for busi­nesses.

The Trea­surer has also tasked the ACCC with a five-year in­quiry into dig­i­tal plat­forms to scru­ti­nise anti-com­pet­i­tive be­hav­iour. The watch­dog will pro­vide its first report on Septem­ber 30 and ev­ery six months af­ter.

The two probes are part of the Mor­ri­son gov­ern­ment’s re­sponse to the ACCC’s ini­tial dig­i­tal plat­forms in­quiry handed down last year.

Mr Fry­den­berg said reg­u­la­tory frame­works needed to keep pace with the changes of me­dia con­sump­tion driven by the in­ter­net.

“The gov­ern­ment recog­nises that there is a need for re­form to bet­ter pro­tect con­sumers, im­prove trans­parency, ad­dress power im­bal­ances and en­sure that sub­stan­tial mar­ket power is not used to lessen com­pe­ti­tion in me­dia and ad­ver­tis­ing ser­vices mar­kets,” he said.

“With dig­i­tal plat­forms col­lect­ing and us­ing enor­mous vol­umes of per­sonal in­for­ma­tion, con­sumers need to be prop­erly in­formed about the data col­lected, how it is be­ing used and by who.”

Face­book, Google and other tech gi­ants have been sub­ject to sev­eral an­titrust in­ves­ti­ga­tions in Europe and the US as a re­sult of their be­hav­iour in the mar­ket, par­tic­u­larly in re­la­tion to ads and treatment of com­peti­tors.

The com­pa­nies have also been fined tens of bil­lions of dol­lars over breaches of pri­vacy and com­pe­ti­tion law.

US fed­eral reg­u­la­tors this week said they were in­ves­ti­gat­ing the tech gi­ants over how they bought smaller ri­vals and whether they harmed com­pe­ti­tion, hurt con­sumers and evaded reg­u­la­tory scru­tiny. The US Fed­eral Trade Com­mis­sion or­dered Face­book, Google, Ama­zon, Ap­ple and Mi­crosoft to pro­vide de­tails as to how their firms dealt with and bought ju­nior ri­vals over the past decade.

The two lat­est in­quiries launched by Mr Fry­den­berg were rec­om­mended un­der the ini­tial probe from Mr Sims, who said there were many “ad­verse ef­fects” on the me­dia mar­ket be­cause of Google and Face­book.

Mr Sims warned that the tech gi­ants were dis­tort­ing the abil­ity of busi­nesses to com­pete on their

mer­its in ad­ver­tis­ing, me­dia and a range of other mar­kets.

He also iden­ti­fied prob­lems with opaque dig­i­tal ad mar­kets, con­sumers not be­ing ad­e­quately in­formed about how their data was col­lected and used, and the rise of “fake news” be­ing shared by the tech gi­ants.

The ad-tech in­quiry will be fi­nalised by Au­gust next year, with an in­terim report to be re­leased by the end of this year.

The probes will be un­der­taken by the ACCC’s new dig­i­tal plat­forms branch, which was pro­vided with $26.9m in fund­ing in De­cem­ber.

The find­ings from the in­quiries will build on re­forms un­veiled by the Mor­ri­son gov­ern­ment in De­cem­ber, which in­cluded a vol­un­tary code of con­duct re­quir­ing dig­i­tal gi­ants to pay me­dia com­pa­nies for con­tent.

If a dig­i­tal plat­forms code of con­duct can­not be fi­nalised by Novem­ber the gov­ern­ment would step in to in­tro­duce a man­dated scheme.

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