ACCC Digital Services Enquiry: The Ongoing Battle

ACCC Digital Services Enquiry: The Ongoing Battle

20 October 2022 |

Media and Advertising Industry

The ACCC is continuing its 5-year inquiry into social media and digital service platforms, specifically looking into competition and consumer issues within the digital platform ecosphere. It’s delivering regular interim reports and the latest report can be accessed here. In August the ACCC asked industry stakeholders a number of questions, including whether the landscape has changed significantly since 2019, before it submits its final report in March 2023. This has caused disagreements all around between advertising platforms.

The two sides to the Digital Services Enquiry

Facebook isn’t happy all eyes are on the social media giant and has gone to lengths to call out other social media apps in markets such as TikTok, YouTube and even Strava to join them in the spotlight too. It suggests that the market landscape is completely different to when the inquiry first started, with new entrants now taking power. Facebook wants YouTube to be classified as a social media platform, and TikTok should also be regulated given its +40% YoY growth heading into 2022.

In a rare occurrence, a broadcast network in fact agrees with Facebook – maybe for the first time in history. Channel Nine supports the move that TikTok should also be subject to the same news media bargaining codes as its Facebook counterpart. This means TikTok would also be liable to pay Nine for its content used on the social media platform.

Other parties however disagree. Free TV (the industry body for Australia’s commercial free-to-air TV) has its daggers out for Facebook only. It makes the point that Facebook user numbers have not declined since the growth of TikTok – Australians are simply consuming more. Therefore Facebook should remain the sole focus of the ACCC media inquiry.

Agreement on algorithmic changes and content regulation

Everyone would like to be kept in the loop. All submissions for the ACCC report would like the big media giants (note Facebook + Google) to provide notice of any upcoming algorithm changes, to enable them to remain competitive in the market.

A growing collective also agrees that any content regulation will be a cost barrier to the platforms providing the same free service users know and love currently. In addition, it could lead to ‘’over removing’ content. As platforms are threatened with fees, this could see them being over-cautious in removing content, and therefore culling freedom & variety of information that is so widely available right now.

It would also deter new entrants argues Pinterest, further fuelling Facebook’s dominance in the market.

In my opinion?

There may be additional accelerated social media entrants in the market since 2019 but this has not detracted from Facebook user numbers which have not declined for the past 5 years. Therefore, based on data alone, it’s hard to disagree that the social media giant doesn’t still dominate, therefore the original inquiry still stands. However, 3 years in the ad tech world is a lifetime, and without including a threshold or rule for such regulations, the ACCC is at risk of creating one rule for one, and one rule for another.

Whilst I fully support publishers and content creators being remunerated adequately for their services, any regulation should not come at the cost of innovation. Therefore, the algorithm change notification isn’t feasible in a world where some major tech players release an update up to 600 times a year.

Stay tuned for the next ACCC update…

Or reach out to our ADMATICian today to learn more!