Dowden: Tech Giants’ Anti-Competitive Practices Have Had Devastating Effects Upon Newspaper Industry

Government is determined to tackle the “devastating” effects on the newspaper industry of the tech giants’ anti-competitive practices, Culture Secretary Oliver Dowden said today. 

Speaking to RESET 2021, a virtual event from the Advertising Association, the IPA and ISBA, the Culture Secretary said it was time to “even the playing field” and correct the “fundamental imbalance” between publishers, advertisers and the online platforms.

Mr Dowden said the rise of online advertising had created a number of challenges. He said: “There are growing concerns about brand safety, about transparency and accountability; around content standards, and harm.

“Most of all, the rise of online advertising has created a fundamental imbalance: between publishers, advertisers and the online platforms upon which they increasingly rely.

“It’s time to even the playing field.”

He added: “We want to make sure big tech cannot exploit its dominance to crowd out competition and innovation, and expose people to unfair or exploitative practices – with businesses and consumers in turn paying the price.

“So we are establishing a Digital Markets Unit, housed in the Competition and Markets Authority, to enforce a new code of conduct for tech giants.

“And we are going to tackle the devastating knock-on effects that anti-competitive practices have had on our newspaper industry, which were outlined in the Cairncross Review.”

The News Media Association has called for legislation underpinning the new Digital Markets Unit to be implemented as quickly as possible, in order to level the playing field with the tech giants, warning that delays could see local newspapers go out of business. 

Adspend figures for Q3 2020 from AA/Warc published this week show that the tech platforms are continuing to eat into other media sectors’ share of advertiser spend as the coronavirus pandemic severely depresses ad revenues for the content creators.    

Internet pure play, mainly Google and Facebook, grew by 11.6 per cent year-on-year while every other category experienced dramatic declines.

Internet pure play is forecast by AA/Warc to account for more than two thirds of the adspend in the UK in 2020 and, in Q3 2020, the tech giants increased share by 6.2 per cent while every other sector lost share.

In his speech today, Mr Dowden also talked about the Government’s intention to ban online advertising for products that are high in fat, sugar and salt, saying that he woudl fight the industry’s corner.

“This decision was taken against the specific and, as I hope you’ll appreciate, exceptional backdrop of a health emergency. I believe it’s the right one, given all that COVID has taught us.

“However, I do genuinely appreciate it will have a really significant impact at what is already a very difficult time for the sector.

“I understand those concerns, and I will continue to listen to the industry to make sure we get this right, and enable the shift to advertising healthier products.

“And I will fight your corner in the coming months and years, making sure you have a strong and clear voice in Government.”