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This new 'Big Tech' watchdog says it will stop Google and Facebook crowding out the competition

ZDNet logo ZDNet 5 days ago Liam Tung
a double decker bus parked in front of a building: LONDON, UNITED KINGDOM - August - 20, 2016: Westminster palace and Big Ben and traffic on Westminster bridge in foreground (LONDON, UNITED KINGDOM - August - 20, 2016: Westminster palace and Big Ben and traffic on Westminster bridge in foreground, ASC © Sylvain SONNET, Getty Images

LONDON, UNITED KINGDOM - August - 20, 2016: Westminster palace and Big Ben and traffic on Westminster bridge in foreground (LONDON, UNITED KINGDOM - August - 20, 2016: Westminster palace and Big Ben and traffic on Westminster bridge in foreground, ASC

The UK's competition regulator has established a new division that specializes in online platforms, such as Google and Facebook. 

The new Digital Markets Unit (DMU) has been set up as part of the UK's Competition and Markets Authority (CMA). The DMU aims to improve consumer's choice and control over data, while promoting competition among online platforms, and cracking down on anticompetitive behavior that harms consumer choice or raises prices. 

The CMA announced plans for the DMU in November, citing "growing consensus in the UK and abroad that the concentration of power amongst a small number of tech companies is curtailing growth in the tech sector, reducing innovation, and potentially having negative impacts on the people and businesses that rely on them."

It describes the new unit as "a tough new regulator to help make sure tech giants such as Facebook and Google cannot exploit their market dominance to crowd out competition and stifle innovation."

The UK Business Secretary Kwasi Kwarteng said the DMU will be an "unashamedly pro-competition regime"

The DMU won't have full powers as a regulator until the UK government passes more legislation; in the meantime it will look at how new codes of conduct could work between big tech platforms and small businesses that rely on them to reach customers. 

The DMU has also been tasked to work with the UK communications authority, Ofcom, to look at a code of conduct to regulate the arrangements between news publishers and online platforms. 

The DMU will look "specifically at how a code would govern the relationships between platforms and content providers such as news publishers, including to ensure they are as fair and reasonable as possible."

That move follows Australia's controversial Media Bargaining Code, which passed into law in February and, after protests from Facebook and Google, leading to new financial deals between Google and several large Australian news publishers. Microsoft president Brad Smith has advocated for a similar system as Australia's to regulate big tech and US news publishers.        

"The Digital Markets Unit has launched and I've asked it to begin by looking at the relationships between platforms and content providers, and platforms and digital advertisers," said Digital Secretary Oliver Dowden. 

"This will pave the way for the development of new digital services and lower prices, give consumers more choice and control over their data, and support our news industry, which is vital to freedom of expression and our democratic values."

Separately, the CMA is seeking evidence of companies using algorithms to harm consumer choices without their knowledge, such as by faking scarcity of a product in order to stimulate purchases.  

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