Ad tech under investigation


4th March, 2020

ACCC’s inquiries into Facebook, Google to even ad tech playing field

The Australian Competition and Consumer Commission (ACCC) has embarked on two new government supported inquiries into the “black box nature” of major ad tech (digital advertising and media companies) in Australia, including the likes of Google and Facebook.

In December 2019, the Morrison Government gave the ACCC the go-ahead to launch two new inquiries into digital marketing and media agencies, committing $27 million over four years to help form a “digital platforms branch” to sit within the ACCC, dedicated to running these types of inquiries.

Forming this branch was one of the 23 recommendations that the consumer watchdog announced following its initial 17 month inquiry into digital platforms, which culminated in July 2019.

Earlier in 2020, the newly formed branch officially launched two digital platform inquiries that are set to run alongside each other over the course of the next five years.

The first inquiry will be relatively short lived and will focus specifically on digital advertising services (ad-tech), while the second will be a lengthier inquiry into digital platforms overall, furthering the investigations that it made when compiling its initial report.

Upon launching these two inquiries, Treasurer Josh Frydenberg released a statement saying that the ad-tech inquiry would last for 18 months and focus on technologies that facilitate “the supply of online advertising to Australian consumers”.

“These technologies gather information about consumers and use it to target them with highly personalised advertising,” Frydenberg said in his statement.

Frydenberg also laid out the Coalition’s intentions in launching both inquiries, saying that the investigations will aid in the delivery of a “regulatory framework” that will better “protect and inform” Australian consumers.

The ad-tech inquiry is expected to be completed at the end of August 2021, with the release of an interim report at the very end of 2020.

UPDATE: On 10 March, the ACCC released an issues paper seeking ‘views on the key issues affecting markets for the supply of digital advertising technology services. If you’re interested in participating, you can find that issues paper and associated documents on the ACCC website.

As for the second and more general inquiry, things are expected to take a little while longer, with the final report release date marked for 31 March 2025. As part of its ongoing investigation process, the ACCC will be releasing a biannual interim report until the inquiry comes to an end.

This five-year-long inquiry will be placing the practices of global digital marketing giants Google and Facebook under a microscope, as well as other online messenger services, digital content aggregators and data brokers.

According to Mumbrella, both Facebook and Google have responded positively to the inquiry, expressing that they were ready and willing to work closely with the regulator to strengthen consumer competition in Australia.

Forming the branch to sit within the ACCC and launching these two inquiries were among a number of the 23 recommendations that the Morrison Government supported. Others included the formulation of a voluntary code of conduct, increased penalties for digital platforms that breach the Privacy Act, restructured media regulations and the enforcement of a binding online privacy code.

Among several others, the Coalition rejected the ACCC’s key recommendation to offer tax incentives to philanthropists who support Australian journalism, which news has since been followed with the announcement that the Australian Associated Press is set to close its doors.