Following The ACCC’s Lead? UK To Clamp Down On Tech Giants

Palo Alto, California, USA - January 02, 2018: Google parking street/pavement sign. Title of a Google on a parking spots for Google employees in Silicon Valley.

Britain’s competition watchdog has tech giants Google and Facebook on its radar, revealing there is a “strong argument” to introduce legislation to thwart the dominance of such companies.

The Competition and Markets Authority (CMA) released its interim report into online platforms and digital advertising, which found more than 90 per cent of all revenue earned from search advertising in 2018 was directed to Google.

Similarly, the report found more than half of all display advertising revenue went to Facebook.

“‘Big’ is not necessarily ‘bad’ and these platforms have brought very innovative and valuable products and services to the market,” the CMA said.

“But the CMA is concerned that their position may have become entrenched with negative consequences for the people and businesses who use these services every day.”

Announcing the preliminary findings, the CMA pointed to the Australian Government’s recent decision to create a digital markets unit within the ACCC, as part of its response to the Digital Platforms Inquiry.

“Many of the problems that the CMA has currently identified are international in nature,” the watchdog said.

“The CMA has taken a leading role in these global discussions for some time now and will continue to further the debate as part of its digital strategy.”

The report also pointed to recent ‘Unlocking digital competition’ report, which called for the development of a code of competitive conduct for digital platforms.

“At this stage, the CMA agrees with Professor Furman [author of the report] and his colleagues who carried out a wide-ranging review of digital markets earlier this year, that there is a strong argument for the development of a new regulatory regime,” the CMA said.

“This could include rules governing the behaviour of online platforms and giving people greater control over their own data. The most likely outcome at the end of this study will be recommendations to the new Government as it decides whether and how to regulate the digital sector.

“On the other hand, the CMA stands ready to act directly through any or all of its own powers if, ultimately, these issues are not addressed in other ways, whether domestically or internationally.”

The CMA’s final report is due to be released on 2 July 2020.


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