UK govt tech regulators move to tackle major firms’ dominance


Small businesses will be protected from predatory practices and consumers will get more choice and control over their online experiences as the government today sets out its final vision for how the new digital markets regulator will boost competition to drive economic growth and innovation The Trumpet gathered.

The majority of UK companies now rely on powerful tech firms to ensure customers find their business online. These firms control key online gateways for millions of internet users and give preference to their own apps and browsers. They are also able to set their own prices for the online services they provide businesses without challenge, which can be passed on to consumers.

The impact of weakened competition is stark – the Competition and Markets Authority estimates that Google and Facebook made excess UK profits of £2.4 billion in 2018 alone harming consumers through higher prices. In response to its consultation issued last year, the government today sets out its plans to give statutory powers for the Digital Markets Unit (DMU) to allow it to enforce pro-competition rules and rebalance the relationship tech giants have with consumers and businesses so they are better protected from unfair practices. The DMU is a new watchdog to make sure tech companies don’t abuse their market power.

The proposals aim to make it easier for people to switch between Apple iOS and Android phones or between social media accounts without losing their data and messages. Smartphone users could get more choice of which search engines they have access to, more choice of social media platforms as new entrants enter the market, and more control over how their data is used by companies.

Tens of thousands of UK small and mediumsize businesses will get a better deal from the big tech firms which they rely on to trade online. Tech firms could need to warn smaller firms about changes to their algorithms which drive traffic and revenues.

The measures will also make sure news publishers are able to monetize their online news content and be paid fairly for it, with the DMU given the power to step in to solve pricing disputes between news outlets and platforms. App developers would be able to sell their apps on fairer and more transparent terms.

More competition across digital markets will create incentives for internet companies to deliver better quality services. Lower fees for advertisers and businesses will stop costs being passed on to consumers leading to lower prices for the goods they buy online.

Read Also: NCC rallies media stakeholders on telecoms industry reportage

The government will introduce legislation to put the Digital Markets Unit on a statutory footing in due course. Digital Minister Chris Philp said:

Technology has revolutionised the way thousands of UK firms do business – helping them reach new customers and putting a range of instant online services at people’s fingertips. But the dominance of a few tech giants is crowding out competition and stifling innovation.

We want to level the playing field and we are arming this new tech regulator with a range of powers to generate lower prices, better choice and more control for consumers while backing content creators, innovators and publishers, including in our vital news industry.

The DMU, launched in non-statutory form within the Competition and Markets Authority (CMA) last year, will have the power to designate some of the world’s most powerful firms with ‘strategic market status’.

The regulator will enforce new tailored codes of conduct for how the handful of firms dominating digital markets should treat their users and other companies fairly, with tough sanctions for those which ignore the rules.

Under these binding conduct requirements, firms must ensure consumers have open choices about the digital services they use.

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