Does the Government's roadmap of reforms for digital platforms go far enough?

Voluntary code of conduct off the back of the ACCC's Digital Platforms inquiry questioned as going far enough to trigger wholesale change

Scepticism is emerging across the industry around whether the Australian Government's response to the ACCC's Digital Platforms Inquiry goes far enough to tackle the issue of digital platform dominance in the media and marketing landscape.

The Australian Government yesterday outlined a roadmap for a program of work and a series of reforms to promote competition and enhance consumer protection, following the ACCC’s Digital Platforms report released in July. The consumer watchdog's series of scathing and wide-spread findings found the dominance of the large digital platforms and their impact on the economy, the media and society broadly must be addressed with significant, holistic reforms.

For the most part, industry welcomed the Government's support of the findings and saw it as a step forward. However, several say the roadmap does not go far enough to protect consumer privacy, with particular scepticism levelled at the proposed 'voluntary code of conduct'.

Digital platforms have yet to respond, however, Facebook was critical of the ACCC's recommendations when they were first released. 

The Australian Government undertook a 12-week review of the ACCC’s recommendations and has now committed to:

  • Establishing a $27 million special unit in the ACCC to monitor and report on the state of competition and consumer protection in digital platform markets, take enforcement action as necessary, and undertake inquiries as directed by the Treasurer, starting with the supply of online advertising and adtech services. 

  • Addressing bargaining power concerns between digital platforms and media businesses by tasking the ACCC to facilitate development of a voluntary code of conduct.

  • Commencing a staged process to reform media regulation towards an end state of a platform-neutral regulatory framework covering both online and offline delivery of media content to Australian consumers. 

  • Ensuring privacy settings empower consumers, protect their data and best serve the Australian economy by building on the commitment to increase penalties and introduce a binding online privacy code announced in the 2019–20 Budget, through further strengthening of Privacy Act protections, subject to consultation and design of specific measures as well as conducting a review of the Privacy Act.

The ACCC has welcomed the Government’s response and said it will continue its work in digital platform markets through the establishment of a permanent Digital Platforms Branch, to enable continuous and consistent scrutiny of digital platforms, and current and future consumer and competition law enforcement cases. In addition, the ACCC will start a new inquiry into the digital advertising tech supply chain, focusing on digital display ads.

“We are delighted the government has recognised the significance of the ACCC’s findings on the impact of the leading digital platforms on competition, consumer, privacy, media and advertising markets,” ACCC chair, Rod Sims, said. “We’re proud Australia will now be one of the first countries in the world to develop such a comprehensive roadmap for broad reforms relating to digital platforms.

Google and Facebook have grown to have almost unfettered market power with significant impacts on consumers that must be addressed.

“The impact of digitalisation and digital platforms on the Australian media and, in particular, vitally important local and regional news and journalism has been stark and extremely concerning.

“We are pleased this is being addressed by the Government, along with the regulatory imbalance between the platforms and media businesses. An additional code of conduct will also be developed to address disinformation, which is a growing concern globally."

Sims said the ACCC will work closely with the Prime Minister’s Digital Technology Taskforce, the Office of the Australian Information Commissioner, the Australian Communications and Media Authority (ACMA) and other agencies to ensure all of these reforms are addressed in a holistic way.

“The world is waking up to the very real harms that stem from the power the digital platforms hold in our society and for our economy. The good news is it is not too late to ensure Australian businesses, consumers and society can benefit from the advances offered by digital platforms, while ensuring appropriate safeguards are in place to address the negative impacts,” Sims added.

Similarly, the Telecommunications Industry Ombudsman (TIO) was pleased to see the Government accept its recommendation on running a pilot external dispute resolution mechanism for consumers, businesses and digital platforms. TIO board chair, Michael Lavarch, said ensuring digital platform users have access to a single complaint framework accommodating the converging communications landscape is required and appropriate. 

“The digital platform landscape is complex and the appropriate regulatory and legislative reform will take time to settle. A Digital Platforms Ombudsman pilot with a clear remit to support users already experiencing detriment is a step that can be taken while the broader issues continue to be assessed,” he stated.

Senior lecturer in media and social media major director at Swinburne University, Dr Belinda Barnet, liked the idea we are expanding the definition of 'personal data' to include 'technical data'. 

"If implemented it will expand what is covered by the privacy act and may mean that companies must seek our consent before tracking us or collecting our IP address," she told CMO.

"I don’t think getting platforms to promise they’ll behave well with respect to misinformation [voluntary code of conduct] will work."

Adjunct professor of economics at UTS Business School, Dr Paul Paterson, told CMO the ACCC Digital Platforms report is an excellent piece of analysis with well targeted, practical recommendations.

"A strong element of the Government’s response is for further consultation. While consultation is important, it should not be at the expense of timely and decisive action," he said.

"Harms are being done to competitive processes, consumer privacy and offensive conduct by the large digital platforms that need prompt attention. Hence consultations need to be focussed and conducted to a tight timeframe, and subsequent policy action enacted expeditiously.

"Re the recommended changes to merger laws involving the acquisition of startups by the large digital platforms, the right balance needs to be struck to allow startups to flourish and become potential competitors while avoiding undue chilling of startup innovation that is fuelled by the prospect of early stage sale to a large platform." 

AMAA chief executive, Josanne Ryan, said the government’s response to the ACCC DPI sets the tone for 2020 to be about accountability for the tech giants, but also across the Australian digital trading landscape. 

"The government has delivered a clear roadmap with a raft of important initiatives. The changes mean the tech giants will be governed by new codes of conduct to address the imbalance of bargaining power between the digital platforms and news businesses and to counter news disinformation," she said. 

"We also welcome news the government recognises the need to support public interest reporting and will enhance the Regional and Small Publishers Jobs and Innovation package.

"The funding of a new ACCC Digital Platforms Branch means an ongoing focus on all things digital, kicking off with an inquiry into competition for the supply of digital ad tech services and online advertising. The changes to Privacy Law which confirm the OAIC Commissioner’s commitment to unambiguous consent and compliance, are an important step forward.

"The AMAA looks forward to working the industry and to supporting our members as the digital media landscape continues to evolve.”

Privacy implications

Interactive Advertising Bureau (IAB) Australia CEO, Gai Le Roy, said the government’s response to the recommendations from the ACCC digital platforms provides much welcomed clarity around both the process and roadmap to support a sustainable Australia media landscape in the digital age.  

“The IAB’s considerable experience both local and globally in the issues of privacy, as well as industry standards and guidelines, places us in a unique position to continue closely consulting with Government as it works through the inquiry into adtech services and advertising agencies, as well as its work in strengthening protections in the Privacy Act,” she said. 

DIGI managing director, Sunita Bose, said DIGI will be examining the response to the ACCC digital platforms inquiry closely, and will continue to contribute to ongoing consultation with the Government and regulatory bodies.

“We recognise the importance of the issues raised in relation to maintaining competition in the news and advertising markets, and ensuring consumer privacy is protected online,” Bose said. “We’ll be studying the proposals in detail to ensure the consumer protections are fit for a digital era, and that there are no unintended consequences for Australia’s digital future, economic growth, and global competitiveness. 

“We welcome an economy-wide review of the Privacy Act, as consumers will have the same expectations of privacy, regardless of the specific company they interact with or the sector within which that company sits. 

“At the same time, we also recognise privacy needs to be central to digital products and services and have been engaging with the OAIC on the government’s proposed digital platforms code. 

“DIGI is supportive of efforts to modernise relevant media laws for a digital era, and we look forward to contributing to the development of a regulatory framework that duly recognises some of the fundamental differences between digital products and media businesses."  

Media owners have largely welcomed the news, however some say the recommendations don’t go far enough. News Corp Australasia’s executive chairman, Michael Miller, said the media group is encouraged the Government is taking action on a number of fronts to deal with the power imbalances the digital platforms hold over media businesses.

“Most of these initial steps are aligned with where the world is heading but more reforms are needed to protect consumers and ensure a vibrant and viable media industry,” he said.“The new unit within the ACCC to oversee digital platforms and an inquiry into the murky waters of ad tech are welcomed - they are important and necessary. 

“However, the government's approach of a voluntary code of conduct to oversee commercial arrangements as a first step appears out-of-kilter with leaders of other jurisdictions who have advocated firmer action.”

Seven West Media managing director and CEO, James Warburton, also tempered his response with criticism. 

“Seven is particularly pleased by the announced process to swiftly address out-of-date Australian content requirements currently holding back Australian media businesses. We encourage the Government to move quickly to provide certainty to industry and put in place a new framework for content that better reflects commercial realities and the changed viewing patterns of Australian audiences," he commented.

“The urgent need for regulatory equality between foreign digital platforms and Australian companies has been recognised by the Government. We see this as a real turning point, as for too long legislation has lagged well behind technological evolution, disadvantaging Australian companies and providing foreign Digital Platforms with a free ride.

“However, we are disappointed the government is not pursuing a mandatory take down scheme for copyright infringing material as recommended by the ACCC. But it is pleasing that the Government has committed to reviewing copyright enforcement mechanisms during 2020.

“We look forward to working with the Government as this process moves forward, to ensure a regulatory environment appropriate in the digital age, to better protects consumers and provide a more level playing field for Australian businesses.”

Similarly, Senator for SA and Greens’ Spokesperson for Communications, Sarah Hanson-Young, the recommendations do not go anywhere near far enough to restore funding to the ABC and SBS, protect local content quotas and fund public interest journalism. 

“Despite weeks of chest-thumping, the Morrison government has buckled to the pressure of the tech giants in its lacklustre response to the review,” Senator Hanson-Young said.

“The recommendations from the ACCC were modest at best. The government has side-stepped much needed reform to protect Australian journalism and content. Everyday Australians deserve to know that regardless of how they consume their news and entertainment that it is factual, quality and is a good dose of Australian made. 

“There have been successive reviews of news media over the last decade, from the Finkelstein Review to the Convergence Review, and a separate Senate Inquiries into the Future of Public Interest Journalism and Australian Content. Australia has one of the most concentrated media markets in the world, and right now, ours is continuing to trend in the wrong direction.

“The Commonwealth must play a stronger role in strengthening the health and diversity of our news media. Now is not the time to be complacent.” 

Other media houses were less immediately sceptical. Network 10 chief executive officer, Paul Anderson, said it’s great the Government is making a serious attempt to address the deep-rooted dominance of the online tech and streaming giants.

“On free-to-air content regulation, the issues are clear and the answers are already there. We just have to get cracking and get it done,” he said.

Nine CEO, Hugh Marks, added the response providing a clear timeline and platform for industry to be able to engage with the social media platforms on a basis "we ultimately believe will be a win-win not only for our industry and the people that work in it, but the social platforms as well".

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