Displaying items by tag: ACCC

Tech titans face clampdown from Australian regulator

Written on Sunday, 23 June 2019 11:33

The Australian Competition and Consumer Commission (ACCC) called for new regulations on Facebook, Google and other tech behemoths which could have far-reaching ramifications on their money-making procedures and their ability to choose which content consumers would consume.

The country’s competition watchdog devised some recommendations which, if confirmed, would be among the most restrictive towards tech giants. These recommendations were created in an effort to limit the power of these tech giants due to global concerns of their influence and various other issues such as anti-trust, privacy abuse and the role they play in spreading discriminatory content and misinforming the public.

The ACCC plans to issue its final report by the end of June, following its 18-month inquiry into the issue. This report is expected to comprise of various proposals pertaining to controls that will be imposed on tech giants which handle a large quantity of personal data to use for marketing purposes such as the use of algorithms to coordinate which advertisements to display to customers, which tailored search results will appear and other tailored content.

In the lengthy preliminary report which was issued in December last year, the ACCC raised concerns about the market power of tech companies like Facebook and Google and how their operations are characterized by a “lack of transparency”, especially with regards to the use of our data.

The report, which was initiated by the conservative government, read,: “We are at a critical point in considering the impact of digital platforms on society.” It also shed some light on the impact the tech giants had on Australia’s new industry.

In fact, it was found that since 2014, two tech titans were receiving a huge fraction of the revenues generated from digital advertising which resulted in the number of newspapers and online journalists falling by over 20 per cent.

“While the ACCC recognizes their significant benefits to consumers and business, there are important questions to be asked about the role the global digital platforms play in the supply of news and journalism in Australia,” read the report.

The competition watchdog stated that it wanted to make sure the big firms did not “favor their own business interests, through their marketing power and presence across multiple markets”.

“There are also issues with the role of digital platforms in determining what news and information is accessed by Australians, how this information is provided, and its range and reliability.”

Rod Sims, ACCC chairman, stated that regulatory authorities In the UK, Europe and the U.S. were monitoring the outcome of their inquiry very closely as they are all still in the process of determining their policies regarding the issue.

Many are of the belief that the ACCC’s recommendations are impractical and a little radical.

Prime Minister Scott Morrison’s government has already begun to take action against the growing influence of Big Tech. This includes enabling criminal penalties for social media execs which allow the spread of violent or hateful content on their platforms.

Head of  DIGI, the lobbying group formed by various tech behemoths to deal with the regulator, Sunit Bose, said, “We obviously need really clear rules for the internet that protect privacy, safety, the economic and social benefits of technology while also protecting competition and innovations.”

She also argued that the Australian regulator’s recommendations would hurt Big Tech, as well as start-ups and smaller companies that lack the resources to deal with the new regulations.

“the prospect of having to disclose such sensitive information will serve as a deterrent to global digital companies and start-ups initiating or expanding their operation in Australia,” she said.

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Some of Australia’s leading banks recently made a request to the Australian Competition & Consumer Commission (ACCC) to see if they could “engage in collective negotiation and boycott activities with Apple in relation to its e-commerce Apple Pay platform and with other third party wallet providers in Australia”. The commission has denied an interim authorization for the banks to negotiate with Apple.

“The ACCC has considered interim authorization within a short timeframe at the request of the applicants,” said ACCC chairman Rod Sims in a statement. “However, given the complexity of the issues and the limited time available, the ACCC has decided not to grant interim authorization at this time. The ACCC requires more time to consult and consider the views of industry, consumers and other interested parties.”

The banks involved include the Commonwealth Bank of Australia, as well as Westpac Banking Corporation, National Australia Bank, and Bendigo and Adelaide Bank. According to reports, the banks are after the ability to use near-field communication (NFC) hardware on Apple devices to enable tap and pay through the banks’ own digital wallets.

However, Apple does not allow third-party electronic payment apps to be loaded onto its smartphones. The banks are hoping to negotiate with Apple for access to Apple’s phones without being accused of violating anti-competition laws. Understandably, banks like CBA, NAB, Westpac and Bendigo and Adelaide Bank want to be able to install their own systems on phones that they have already developed.

The commission said its response is not necessarily final, and is taking into account the continuing effects on market competition, the urgency of the requests, and potential harm to the applicants and possible benefits and detriments, CRN reports. The commission is expected to release a draft decision for consultation in October before making a final ruling.

“The ACC today has determined they need more time to review the application and consult third parties, before making a draft determination,” a spokesperson said on behalf of the banks. “The applicants have been in consultation, and will continue to be in consultation with the ACCC up until the final determination is made.

“This application seeks to ensure that Australian customers are able to choose between different mobile wallets to make payments easily. This application has broader industry benefits too. A number of other Australian institutions have supported the ACCC granting the authorization, including Heritage Bank, Tyro and Indue.”

Apple reportedly urged the ACCC to reject the request in a submission, claiming that if granted, “The request would harm consumers, lead to less competition and less innovation, and create a troubling precedent”. Apple also claims that “these banks want to maintain complete control over their customers,” and that it has “struggled to negotiate with the Australian banks”.

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