Summary

In December 2017, the Australian government directed the ACCC to conduct an inquiry into the role of digital platforms in media and advertising services markets, particularly in relation to the supply of news and journalistic content. On February 2018, the ACCC released an Issues Paper identifying the issues on which it seeks feedback.

The Digital Platforms Inquiry ("Inquiry") seeks to assess the current state of competition and fairness in the media and advertising services industries by investigating the role of digital search engines, social media platforms, and digital aggregation platforms.

The ACCC accepted submissions in response to its Issues Paper until 3 April 2018.

What Feedback is Sought by the ACCC?

As set out in the Issues Paper, the ACCC sought feedback on:

  1. Whether digital platforms have bargaining power in their relationships with media content creators and advertisers.
  2. How digital platforms have impacted the supply of news, journalistic content, and advertising content, and whether digital platforms now have excessive control over the supply of content.
  3. Broadly, how technological change and digital platforms have impacted the media and advertising services markets.
  4. How digital platforms use algorithms to determine which content is displayed, and whether this limits consumers' exposure to a variety of news.
  5. The impact of digital platform growth on media organisations—in particular whether it is becoming unviable for traditional media organisations to fund "public interest" and investigative journalism.
  6. How digital platforms collect consumer data, and how this information is used.

Points of Interest and Concerns

As set out in the Issues Paper, the ACCC sought submissions on which "digital platforms" are relevant to the Inquiry. The Issues Paper identifies certain preliminary examples of such platforms. However, as digital platforms interact with consumers and content providers in any number of ways (for example, through search functionality or social media), the ACCC would like to understand which other platforms impact competition.

The ACCC sought submissions on how the scope of "news and journalistic content" should be defined for the purposes of their investigation. The Issues Paper indicates the Inquiry will focus on news content directed at Australian consumers as well as Australian-produced content. The ACCC will focus on "both well-established news providers and publishers as well as newer online-only suppliers of news and journalistic content, including podcasts."

The ACCC is concerned that the digitalisation of news (for example, the use of algorithms to select content) has restricted consumers' access to a diverse range of news and journalistic content. Further, the ACCC is concerned the level of competition in the media industry reduces the amount of funds available to invest in journalism, which limits the breadth of content produced. The ACCC requested feedback to help develop the appropriate metrics for measuring "choice and quality" of content.

Although the ACCC stated that the Inquiry will primarily focus on media markets, the ACCC has also stated it would like to understand how digital platforms impact competition in the advertising services industry.

Finally, the Issues Paper outlines privacy concerns over the collection of consumer data. Further, the ACCC would like to understand how "big data" technologies and algorithmic selection impacts content and "the flow of revenue between different industry participants."

Outcomes

The Issues Paper states the Inquiry may lead to:

  1. Findings regarding structural, competitive or behavioural issues in the relevant markets;
  2. Increased information about competition, pricing and other practices;
  3. Improved transparency for Australian consumers;
  4. ACCC action to address any behaviour that raises concerns under the CCA; and
  5. Recommendations to the government for law or policy change.

Confidential Information

Although the Inquiry is a public process, and feedback is generally posted on the ACCC website, the CCA allowed parties to make a claim for confidentiality. Where confidentiality is an issue, parties were asked to submit public and private versions of their submissions.

The ACCC encouraged parties to submit their private version on the basis that other parties may view the submission under confidentiality undertakings. Where information is highly sensitive, parties may apply to have the information withheld from other parties entirely.

International Investigations

The ACCC's Inquiry mirrors those recently undertaken in Germany and France by competition regulators. This suggests that regulators are grappling with how to ensure that the laws they enforce provide them with the legislative structure to deliver competition law objectives and the remedies to resolve any contraventions.

Key Takeaways

As mentioned, inquiries indicate where the ACCC will focus its resources in the future. An Inquiry is therefore a good opportunity for any party to put their concerns or advice forward.