The Australian Competition & Consumer Commission's (ACCC) preliminary report into Google, Facebook and Australian news and advertising sector has this week been revealed.
The initial findings of the Digital Platforms Inquiry, with the full version expected in June next year, outlines the concerns regarding the market power held by these major platforms, including their impact on Australian businesses.
Here we summarise the top 20 takeaways – the first 11 preliminary recommendation areas followed by the nine proposed areas for further analysis and assessment.
1. Merger law
The ACCC considers that part of the Competition and Consumer Act 2010 could be amended to make it clearer that the following are relevant factors: (a) the likelihood that an acquisition would result in the removal of a potential competitor, and (b) the amount and nature of data which the acquirer would likely have access to as a result of the acquisition.
2. Prior notice of acquisitions
The ACCC is also intending to ask large digital platforms (such as Facebook and Google) to provide advance notice of the acquisition of any business with activities in Australia and to provide sufficient time to enable a thorough review of the likely competitive effects of the proposed acquisition. If such a commitment were not forthcoming from the major digital platforms other options could be considered to address this issue.
3. Choice of browser and search engine
The ACCC is considering recommending that: (a) suppliers of operating systems for mobile devices, computers and tablets be required to provide consumers with options for internet browsers (rather than providing a default browser), and (b) suppliers of internet browsers be required to provide consumers with options for search engines (rather than providing a default search engine). The ACCC considers that where options for internet browsers and search engines are presented, no option should be pre-selected.
4. Advertising and related business oversight
A regulatory authority should be tasked to monitor, investigate and report on whether digital platforms, which are vertically integrated and meet the relevant threshold, are engaging in discriminatory conduct by favouring their own business interests above those of advertisers or potentially competing businesses. These functions could apply to digital platforms which generate more than AU$100 million per annum from digital advertising in Australia. The relevant digital platforms would need to be obliged to provide information and documents to the regulatory authority on a regular basis, and the regulatory authority would need appropriate investigative powers.
5. News and digital platform regulatory oversight
The ACCC considers that the regulatory authority could also monitor, investigate and report on the ranking of news and journalistic content by digital platforms and the provision of referral services to news media businesses. These functions could apply to digital platforms which generate more than AU$100 million per annum in revenue in Australia and which also disseminate news and journalistic content, including by providing hyperlinks to news and journalistic content, or snippets of such content.
6. Review of media regulatory frameworks
The ACCC proposes to recommend the Government conduct a separate, independent review to design a regulatory framework that is able to effectively and consistently regulate the conduct of all entities which perform comparable functions in the production and delivery of content in Australia, including news and journalistic content, whether they are publishers, broadcasters, other media businesses, or digital platforms.
7. Take-down standard
The ACCC proposes to recommend that the ACMA determine a Mandatory Standard regarding digital platforms’ take-down procedures for copyright infringing content to enable effective and timely take-down of copyright-infringing content. This may take the form of legislative amendments to the Telecommunications Act so that the ACMA has the power to set a mandatory industry standard applicable to digital platforms.
8. Use and collection of personal information
The ACCC proposes to amendment the Privacy Act to better enable consumers to make informed decisions in relation to, and have greater control over, privacy and the collection of personal information. Recommendations are aimed at reducing information asymmetries to improve the transparency of digital platforms’ data practices.
9. OAIC Code of Practice for digital platforms
The ACCC proposes to recommend that the Office of the Australian Information Commissioner (OAIC) engage with key digital platforms operating in Australia to develop an enforceable code of practice under the Privacy Act to provide Australians with greater transparency and control over how their personal information is collected, used and disclosed by digital platforms. The code of practice would likely contain specific obligations on how digital platforms must inform consumers and how to obtain consumers’ informed consent, as well as appropriate consumer controls over digital platforms’ data practices.
10. Serious invasions of privacy
The ACCC proposes to recommend that the Government adopt the Australian Law Reform Commission’s recommendation to introduce a statutory cause of action for serious invasions of privacy to increase the accountability of businesses for their data practices and give consumers greater control over their personal information.
11. Unfair contract terms
Nine proposed areas for further analysis and assessment:
12. Supporting choice and quality of news and journalism
In considering the impact of the digital platforms on the quality of news and journalistic content, the ACCC has not attempted to undertake an empirical assessment of news and journalistic content. However, consistent with existing codes and frameworks that aim to hold Australian journalists and news media businesses to account, the ACCC considers that there are certain aspects of the process of producing news which are important indicators of quality, such as objectivity, accuracy (fact-checking) and the performance of functions such as analysis and investigation.
13. Improve news literacy online
The ACCC is considering measures aimed at increasing news literacy and is considering recommending that the ACMA work with the leading digital platforms to develop a broad campaign targeted at all Australians, to improve their understanding of how news and journalism is curated and displayed on social media and other digital platforms.
14. Improving the ability of news media businesses to fund the production of news and journalism
News and journalism have broad public benefits to society and the ACCC is concerned at the risk of under-provision. The ACCC is therefore continuing to consider mechanisms to maintain the incentives on print/online news media businesses to invest in news and journalism, particularly those types of news and journalism which may be at risk of being under-produced.
15. A digital platforms ombudsman
The ACCC is considering whether an ombudsman could be established to deal with complaints about digital platforms from consumers, advertisers, media companies, and other business users of digital platforms. An ombudsman could investigate complaints that are unable to be resolved by the internal dispute resolution mechanisms of digital platforms and make decisions that are binding on digital platforms.
16. Monitoring of intermediary pricing
The ACCC considers that a regulatory authority could have the power to monitor the pricing of intermediary services supplied to advertisers or websites for the purpose of digital display advertising. To achieve this, businesses offering these services earning revenue exceeding a certain threshold could be required to provide a regulatory authority with details on the price charged for each product offered, an explanation of how that price is determined, the revenue received for supplying each product or service and any discounts, rebates or other incentives offered to customers.
17. Third party measurement of advertisements served on digital platforms
The ACCC is considering whether there is an ability for advertisers to verify whether advertisements on digital platforms, including Google and Facebook, are delivered to their intended audience and whether there may be instances where the performance of digital advertising is overstated; or advertisers are misled into thinking more consumers viewed their advertisements than actually did. The ACCC is examining the extent to which the current level of third party measurement overcomes these problems.
18. Deletion of user data
The ACCC is considering whether there should be an explicit obligation to delete all user data associated with an Australian consumer once that user ceases to use the digital platform’s services or whether user data should automatically be required to be deleted after a set period of time.
19. Opt-in targeted advertising
The ACCC is considering whether, in addition to proposed preliminary recommendation on consumer consents, in relation to targeted advertising, should be further strengthened by stopping entities from collecting, using, or disclosing personal information of Australians for targeted advertising purposes unless consumers have provided express, opt-in consent.
20. Prohibition against unfair practices
In a prior review of the Australian Consumer Law, Consumer Affairs Australia and New Zealand recommended to governments that exploration be undertaken as to how an unfair trading prohibition could be adopted within the Australian context to address potentially unfair business practices. The ACCC is considering whether its exposure to issues through this Inquiry considerably strengthens the need for a general prohibition against the use of unfair practices in the Australian Consumer Law. Such a prohibition could deter digital platforms and other businesses from engaging in conduct that falls short of societal norms, but which is not currently captured under the Australian Consumer Law.
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