Government Says Digital Services ‘Pose Challenges’ To Existing Competition Frameworks
The Government is to review the UK’s competition regime to help address the challenges posed to the existing framework by ad-funded free digital services after calls for reform by the News Media Association and others.
In its response to the House of Lords Communications Committee’s report UK advertising in a digital age’, the Government said it will “review the UK’s competition tools in the context of digital markets to make sure the powers are effective in responding to the new digital challenges.”
The Government said it recognised the highly complex nature of the online advertising industry and was keen to gather more evidence on the business models in the digital media advertising market as part of the Digital Charter’s work programme.
The Cairncross Review would also consider the impact of search engines, social media platforms and other digital content aggregation platforms on the news media industry, as well as issues concerning the transparency of data, the Government added.
The NMA has called for reform of the competition regulatory regime to help tackle the negative impact of the tech giants on the publishers of original news media journalism.
The NMA also welcomed a key recommendation in the Lords Committee’s report which called on the competition authorities to carry out an investigation into the digital advertising market and the dominance of the major tech platforms.
In response to the report published this week, the Government said that legislation over online advertising had not been ruled out after the Committee had called for new controls over online advertising and relevant CMA inquiries.
The Government welcomed the advertising industry’s steps towards further self-regulation of online advertising through, for example, the Digital Trading Standards Group. It noted that advertisers had withdrawn from platforms they do not feel adequately protect their brand, when these platforms place their adverts alongside harmful content.
It hoped that this action from advertisers will encourage platforms to embed safety considerations into every level of their business. It was also working with a range of stakeholders, including regulators, platforms and advertising companies, to ensure that the principles that govern advertising in traditional media also apply and are enforced effectively online.
Nonetheless, the Government‘s White Paper later this year might consider online advertising as an area for upcoming legislation specifically focusing on online harms. As a matter of principle, the Government noted that it prefers effective self-regulation over statutory regulation, with reference to the CAP Code, its application to online, its enforcement by the ASA, its evolution and review to take into account changing technologies and emerging platforms.
The Committee had also expressed concern that many businesses exploit users’ data without informed consent. Nonetheless the ability to transfer data to and from the EU is essential for the advertising industry.
It recommended that the Government should ensure that the UK maintains regulatory alignment with the EU on data protection and that the Information Commissioner’s Office has a position on the European Data Protection Board.
The Government agreed that the continued free flow of data is crucial to underpin the wider future UK/EU relationship.