‘Break up Google to level media playing field’: News Corp
News Corp Australia has urged the competition regulator to consider breaking up Google’s advertising and search businesses.
News Corp Australia has urged the competition regulator to consider breaking up Google’s advertising and search businesses as a “bold” solution to the substantial market power of the tech giants amid concerns they are unfairly taking advertising dollars from Australian media businesses.
In a submission to the Australian Competition & Consumer Commission review of digital platforms, News Corp also called for restraint on digital platforms’ use of publishers’ content unless they provide “fair compensation”.
The submissions released yesterday followed preliminary findings from the ACCC in December that the tech giants had market power and regulation was needed to provide transparency around news and advertising algorithms.
ACCC chairman Rod Sims warned last month the tech giants could have an “unfair advantage” in attracting advertising dollars, given they do not have to abide by the same regulations, such as local content and advertising restrictions and licensing agreements, that bind traditional media.
At the time, he said the ACCC was looking at issues in the digital advertising supply chain, including how advertising was verified.
“Google has substantial market power in search advertising; and we also think Facebook has substantial market power in display advertising, a market which captures both advertising on social media platforms as well as other websites,” Mr Sims said.
Google, which does not produce content but ranks it in search results, last week rejected calls for regulatory oversight. Facebook, in its response, said regulation would not address the issues facing the news media in Australia.
News Corp Australia executive chairman Michael Miller said the ACCC should maintain the focus of the inquiry on the market power of the tech titans in media and advertising markets: “This includes giving the ACCC powers to oversee and monitor digital platforms’ behaviour relating to advertising, the display of news and journalistic content and ad tech, including their algorithms.”
Mr Miller’s comments follows those of News Corp CEO Robert Thomson, who last week commended the efforts of the ACCC, and pointed to a day of “reckoning” for the platforms.
“Thankfully, there is indeed a more contemplative crew of contemporary politicians and regulators not merely dazzled by the digital or falling for the fashionable — they are able to divine the difference between artificial intelligence and the artifice of intelligence,” Mr Thomson said.
News Corp, publisher of The Australian, yesterday welcomed proposals for regulation on news and advertising by the ACCC, and said divestment of Google Search and Google Ad Manager from the Google business could “correct the market structure”.
“Google leverages its market power in both general search services and ad-tech services to the detriment of consumers, advertisers and news publishers. To remedy these harms, Google could either sell Google Search, or retain Google Search and divest the rest of its businesses to a third party,” the submission said.
“News Corp Australia submits that divestment may represent the most effective and conclusive remedy the ACCC could recommend, since structural remedies provide an enduring solution with relatively low monitoring and compliance costs. “The divestment of Google Search will create a competitive market for search engines, mobile operating systems, internet browsers, the supply of digital advertising, and the supply of ad tech.”
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