Australian media watchdog to investigate Google and Facebook

Gladys Abbott
December 5, 2017

The Australian government said Monday that it is to open an enquiry into Facebook and Google and their impact on the media industries.

Sims said there were growing concerns about the impact of Facebook and Google when it comes to the media's ability to fund journalism, adding that ACCC merger reviews revealed most advertisers are spending less on print newspapers and looking to digital media instead.

Google and Facebook will be subject to an inquiry around the impact of digital platforms on news media in Australia.

The Australian Competition and Consumer Commission will examine whether the pair, along with other internet giants, are misusing their market power to push traditional media outlets out of the advertising market, and cash in on the work of journalists without paying for the privilege.

Digital advertising now accounts for almost half of all of the Australian advertising market, while Facebook and Google parent company Alphabet are expected to take half of the world's internet advertising revenue this year.

The ACCC inquiry was agreed to by Communications Minister Mitch Fifield and Treasurer Scott Morrison in return for the Nick Xenophon Party's crossbench support for local media consolidation reforms recently passed by the Parliament.

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In the USA, lawmakers grilled Facebook, Google and Twitter last month over how foreign nationals used social media platforms to spread misinformation during the 2016 presidential election. The Australian government sanctioned has competitor regulator to carry out an investigation into the digital platform.

The ACCC is being asked to investigate the extent to which platform service providers are exercising market power in commercial dealings with the creators of media content as well as advertisers; their impact on the level of choice and quality of news and journalistic content available to Australians; and the impact of information asymmetry, including innovation and technological change, on competition in the media and advertising sector.

Media market analyst Roger Coleman of CCZ Australia also questioned the objective of the ACCC inquiry, telling The New Daily internet disruption of Australia's mainstream media was "the great attrition". The inquiry would largely focus on market power and misleading information.

It will soon be releasing an issues paper, before completing a preliminary report by the end of next year.

Sims stated that tech firms Facebook and Google would be a large part of the investigation but that Twitter would also come under scrutiny. The ACCC's first report though is due only in December 2018, and the final report could take longer.

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