ACCC inquiry into tech giants: Increased regulation, notice of acquisitions and stricter privacy rules

The Australian Competition and Consumer Commission (ACCC) has said Facebook and Google’s lack of transparency around how algorithms prioritise content raises concerns over whether the platforms are favouring their own businesses, or businesses which they have a commercial relationship with.

According to the preliminary Digital Platforms Inquiry report, which was released this morning, the ACCC is proposing to recommend an investigation and reporting on ‘criteria, commercial arrangements or other factors’ used by digital platforms, to assses the impact they have on the ranking and display of ads and news content.

The preliminary report was released this morning

“The ACCC considers that such a regulatory approach would provide assurances to both businesses and consumers that algorithms are not being used to favour certain businesses or, in the case of news stories, are operating in such a way as to cause significant detriment to the production of news and journalistic content or media markets,” the report said.

“The ACCC recognises the importance of preventing ‘gaming’ of algorithms by advertisers and news media businesses.

“Accordingly, while the ACCC is proposing to recommend that the regulatory authority report publicly on the performance and impact of key algorithms and policies, the ACCC is not proposing that the underlying information provided by the relevant digital platforms to the regulatory authority be made publicly available.”

At the same time, the ACCC has suggested proposing amendments to laws around mergers, which would ensure factors such as the potential for an acquisition to remove a competitor, and the amount of data to be obtained, are more closely considered.

The ACCC is also suggesting large digital platforms provide advanced notice of any business acquisitions in Australia, to allow time to conduct reviews into the effects of the acquisition. It also recommends suppliers of mobile devices, computers and tablets provide consumers with option for internet browsers.

It also proposes to recommend a separate, independent review, which will seek to identify unnecessary regulation to Australian publishers, broadcasters and other media businesses.

The review would focus on content production and delivery, and would seek to establish principles for a platform-neutral regulatory regime, the extent to which an organisation is regulated, as well as guidelines on content rules and means of enforcement.

“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 platform,” it said.

Other proposals include more clarity around privacy and the collection of personal information, and the introduction of a code of practice to provide Australians with more transparency and control over how personal information is collected, used and disclosed by digital platforms.

The ACCC is looking to increase the penalties for breach of the Privacy Act to replicate the increased penalties for breaches of the Australian Consumer Law, the maximum penalty of which is $10m.

Further to the preliminary recommendations, the ACCC has listed a number of other areas where further analysis and assessment is required.

One of the ACCC’s concerns is with the digitisation of news and its automation, which can create a disconnect between content and its source.

“The ACCC is therefore considering proposals to provide greater transparency to consumers about the news they consume on digital platforms,” the report said. “The ACCC notes that some digital platforms, including Facebook and Google, are taking steps to signal and/or curate content served to consumers. In so doing, the platforms are making their own decisions regarding the quality or ‘trustworthiness’ of the content to be served to consumers.”

It is also considering a review into the regional and small publishers’ jobs and innovation package, to determine if it should be continued, tax offsets for costs incurred by news media businesses to produce certain types of journalism, and making personal subscriptions for publications that are signatories to a registered ACMA code of practice, tax deductible.

The ACCC is also considering whether it could establish an ombudsman to deal with complaints about digital platforms, and third-party measurement of ads served on digital platforms.

Now the preliminary report has been released, the ACCC is seeking feedback on its preliminary recommendations and proposed matters for further analysis and assessment. Submissions are due by February 15, 2019.

The findings come a year after the ACCC’s Digital Platforms Inquiry commenced. The Inquiry is a result of the government’s deal with former Senator Nick Xenophon to gain his support for changes to media ownership regulation.


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