Tuesday, 03 July 2018 15:51

ACCC chief issues caution on digital media, urges government scrutiny Featured

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The head of Australia’s competition watchdog says all governments should examine the role digital platforms are playing in society to determine if polices are needed to curb their “pursuit of profit”.

Australian Competition and Consumer Commission chair Rod Sims says how Australia approaches the proliferation of digital platforms, and how they collect and manage data, is one of the defining questions of our age.

“It is important that governments examine the role digital platforms are playing in society and, as with other companies, determine if polices are needed to curb their pursuit of profit given the problems such pursuit will cause.”

“The question of the impact of digital platforms on society is a vital one, for both Australia and the world,” Sims told the International Institute of Communications’ Telecommunications and Media Forum in Sydney on Tuesday.

The ACCC is currently undertaking an inquiry into digital platforms and, according to Sims, the inquiry will consider the disruptive effect of digital platforms on society and look at current investigations and developments overseas.

“It is clear that we need to look at the digital platforms through both a competition and consumer lens. Our experience as a competition and consumer regulator, and as a communication and general infrastructure regulator … means we have the right tools to complete this huge and fascinating task,” Sims said.

The speech also touched on competition in the telecommunications industry and Sims said the ACCC was “very keen to promote competition in wireless communications markets".

“We don’t see particular generations of technology as being the focus of competition as these continue to evolve, but rather we view competition more broadly. We believe that the trade-offs between promoting an early roll out of 5G and competition must be carefully weighed to avoid any unintended consequences, particularly where a fourth mobile player is seeking to enter the market.”

On the inquiry into digital platforms, Sims said the investigation would explore four key questions.

“The first question requires us to examine whether platforms have substantial ‘market power’ and, if so, how is that market power being used,” he said.

Sims said the second question addressed the impact on consumers, and whether digital platforms were sufficiently transparent in the collection and use of consumer data and were complying with Australian Consumer Law.

“We do not believe that consumers are generally well-informed about how digital platforms collect and use their data,” Sims said.

“The issue is not just about the wording of a privacy policy. We will be also examining whether users appreciate the value of the data they are providing to these platforms, both when they are using these platforms, and also when they are not. In other words, are users ‘selling’ their data too cheaply in exchange for convenience?”

Sims said the third question was, “Do digital platforms have an unfair competitive advantage due to the unequal treatment of regulation?”

“The digital platforms are clear competitors to media companies in the case of attracting advertising spend, but the relationship on the content side is more complicated and there are a number of important questions: Are the platforms subject to defamation law or journalism’s codes of conduct?’ ‘Should they be, and how practical is this?’ ‘How does copyright law apply to the digital platforms?’,” Sims said.

“Finally, we are also looking at the impact of the digital platforms on the quality of news and journalism in this country. Quality is extremely hard to assess, but broadly speaking we will be investigating whether the reduction in advertising revenue prevents publishers and broadcasters from delivering quality journalism, by which we mean investigative, verified and diverse journalism.”

“Journalism is a highly valued profession, and crucial to our lives. Just like we are well advised not to rely on amateur doctors, perhaps we should not rely on amateur journalists."


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Peter Dinham

Peter Dinham - retired in 2020. He is a veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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