News from global, Australia’s competition regulator said on Monday it would investigate whether US online giants Facebook and Alphabet Inc’s Google has disrupted the news media market to the detriment of publishers and consumers. The Federal Government has instructed the ACCC to launch an inquiry into the effect search engines and social media platforms have on competition in media and advertising.
“The ACCC (Australia Competition and Consumer Commission) goes into this inquiry with an open mind to and will study how digital platforms such as Facebook and Google operate to fully understand their influence in Australia,” ACCC Chairman Rod Sims said.
“We will examine whether platforms are exercising market power in commercial dealings to the detriment of consumers, media content creators and advertisers.”
Sims says the ACCC will look closely at longer-term trends, and the effect of technological change on competition in media and advertising. The ACCC will also consider the impact of “information asymmetry” between digital platform providers and advertisers and consumers.
According to the ACCC, advertising expenditure in print newspapers has been in decline for “a number of years”. Recent ACCC merger reviews show most advertisers are spending less on print newspapers and finding alternative ways of reaching target audiences – including through digital media.
Like many of its peers around the world, Australia’s traditional media companies have been squeezed by online rivals, for example, advertising fees are transferred to digital distributors, including Google, Facebook and Netflix.
The government ordered the probe as part of wider media reforms, amid growing concern for the future of journalism and the quality of news following years of declining profits and newsroom job cuts and the rise of fake news.
“We look forward to engaging with this process as relevant.” A Google spokesman said.
Facebook did not respond to a request for comment immediately.
When it comes to the investigation, Australia will first investigate about the way Facebook and Google operate and see what impact it has had on Australia. The agencies have the right to ask companies to provide information and have the right to hold hearings, and they will give the final report within 18 months.