Digital platforms, regulation, and media sustainability: A lesson for Europe from Down Under
Mira Milosevic (Executive Director, GFMD)
In early December, the European Commission (EC) announced that it will establish a rapid alert system to help European Union (EU) member states recognise disinformation and misinformation campaigns. This plan includes increasing the budget set aside for the detection of disinformation from £1.69m to £4.4m (€5 million), and it also noted that it would “press technology companies to play their part in cracking down on ‘fake news.’”
The EC is not alone in its efforts to address the rise of online disinformation and misinformation campaigns. Countering propaganda has long been part of a government’s mandate, yet the open, fast-paced nature of social media presents new obstacles in this years-long struggle against untruthful information. Indeed, given the reality of today’s online environment and what it means for conveying accurate, high-quality information, it is important to address underlying mechanisms that have enabled the manipulation of online information spaces in the first place. By also addressing how information is created and disseminated from a market viewpoint, not simply a content viewpoint, it paints a more holistic picture of the challenges faced in keeping a citizenry informed.
A positive example of this holistic view was recently presented by the Australian Competition and Consumer Commission (ACCC), which published a comprehensive preliminary report on their Digital Platforms Inquiry as a result of a year-long open consultation process. This landmark document is meant to consider the wider impact of digital platforms on society. It also addresses key concerns about the role global digital platforms play in the supply of news and journalism in Australia, “what responsibility they should hold as gateways to information and business, and the extent to which they should be accountable for their influence.” Ultimately, the report stressed that digitalisation and the increase in online sources of news and media content highlight how the current sector-specific approach to media regulation is inadequate.
Unlike many European states that are trying to solve problems by essentially “subcontracting censorship” to digital platforms, the Australian competition authority went back to basics. It analysed a regulatory disparity between digital platforms and heavily-regulated media businesses vis-à-vis the market advantages that these platforms have (and often abuse) “because they operate under fewer regulatory restraints and have lower regulatory compliance costs.” The starting point for its analysis is the market power of digital players, and the ACCC considers that both Google and Facebook have substantial market power. “Google and Facebook receive the majority of digital advertising revenue in Australia,” according to the report, “and have captured more than 80% of growth in digital advertising in the past three years.” Moreover, the ACCC estimates that for every AU$100 spent by advertisers on digital advertising, AU$47 goes to Google and AU$21 goes to Facebook. Strategic mergers and acquisitions by both Google and Facebook have further contributed to the market power they currently hold, the report underscored.
This preliminary report requires in-depth analysis and reflection, and is also calling for further feedback and more information. Yet, it sets an important roadmap by systematically addressing market mechanism- and failure-related challenges, as well as regulatory and information flow challenges in digital environments. The report recommendations also include:
- Measures to address Google and Facebook’s market power by strengthening merger laws and processes, while promoting consumer choice by addressing competition barriers.
- Measures to monitor digital platforms’ activities and the potential consequences of those activities for news media organisations and advertisers. It calls for a regulatory authority to be tasked with monitoring, investigating, and reporting on the criteria, commercial arrangements, or other factors used by relevant digital platforms to impact: (1) the ranking and display of advertisements, and (2) the ranking and display of news and journalistic content with the aim of identifying the effects of algorithms and other technologies or policies on the production of news and journalistic content vis-à-vis competition in media markets.
- Measures to address regulatory imbalances by reviewing the media regulatory framework.
- Measures to facilitate a more effective process/mechanism for the removal of copyright-infringing material by establishing an effective industry standard.
- Measures to better inform consumers when dealing with digital platforms about their rights.
The ACCC also highlighted areas where further analysis and assessment is required, including identifying mechanisms that would support choice and quality of news and journalism.
The ACCC report is exactly the kind of response that Tom Wheeler, senior research fellow at the Shorenstein Center and former U.S. Federal Communications Commission (FCC) chairman, called for earlier this year when he warned that the time to develop rules for Internet capitalism is overdue: “The new realities of agile, fast-paced, continually-evolving digital activities require a rethinking of the proper approach to government oversight … The solution is not to abandon oversight, but to adapt such oversight with digital economy concepts replacing industrial economy concepts.”
Shifting the focus from Canberra back to Brussels, the EC has an important figure who is leading the way in shaping the future of the digital economy in the EU: Competition Commissioner Margrethe Vestager. She already paved the way for European competition authorities to address the anti-competitive practices of digital players by fining Google €4.34 billion (US$5.1 billion) for breaching EU antitrust rules by imposing illegal restrictions on Android device manufacturers and mobile network operators to strengthen the dominance of Google’s search engine. Vestager is hosting a one-day conference on “Shaping competition policy in the era of digitisation” on 17 January 2019 in Brussels. She has also appointed a panel of three advisers, all academics, from outside the Commission — Heike Schweitzer, Jacques Crémer, and Yves-Alexandre de Montjoye — to draft a report on the future challenges of digitisation for competition policy. The agenda of the conference will address (1) competition, data, privacy, and artificial intelligence (AI); (2) digital platforms’ market power; and (3) preserving digital innovation through competition policy.
What is severely lacking, however, is any mention of news, journalism and information ecosystems, and the implications of digital platforms’ market power on the access and availability of quality news content on the Internet. As the U.S.-based advocacy and policy organisation Public Knowledge eloquently underlined in a three-part series in November, any serious effort to address the myriad problems plaguing digital platforms must also address the challenges faced by news media. In other words, content-related issues must also be seen within the wider context of market-related issues. In order to foster a pluralistic media ecosystem that detects disinformation and produces high-quality, fact-based news, media sustainability must be considered a significant priority.
Instead of being treated holistically as equally important pieces of the larger puzzle of media ecosystem failure, and the subsequent problems this failure creates that are currently vexing governments, these topics are unfortunately discussed by a different EC directorate at a different conference. We strongly encourage the EC to continue to craft its own digital pathway, but one that ensures freedom of expression and sustainability of news information ecosystems online — including public service local journalism. Thus, it may serve the EC well to look to their Australian colleagues for approach and guidance.
GFMD is committed to advocating for recognition of the wider impact of digital economy on society, and to addressing key questions about the role that global digital platforms as market players and businesses play in the supply of news and journalism and the space for public debate. We will continue to ask policy-makers to include news media in deliberations concerning regulation and its effect on media pluralism and sustainability. One way we are doing so is via a GFMD working group on Internet governance, which is working to help shape the digital policy agenda. For more information, see our issue paper on Internet governance and media development.