News & events

Government answers calls to fix “dysfunctional” online ads market

A new Digital Market Unit will be set up to govern the actions of tech platforms. 

Tech platforms face a new competition regime that will be introduced by government to ensure the sustainable future of trusted journalism in the UK by balancing the power between publishers and online platforms. 

The new code of conduct due to launch in April will also allow consumers to have better control over their data, make sure that all businesses are treated fairly, helping smaller businesses thrive and could require digital advertising platforms to be more transparent about the services they provide.

A dedicated Digital Markets Unit will oversee the move and sit within the Competition and Markets Authority (CMA). It will work together with other regulators such as Ofcom to ensure the new code of conduct is adhered to.

The move comes as a House of Lords committee said that government needed to act quickly as journalists and independent news is facing an “an existential threat”.

Lord Gilbert of Panteg, chair of the communications and digital committee, commented: “Journalism is important to a healthy democracy. There’s an opportunity for the government and organisations to come together, step up and support journalism – now and in future. 

“Online advertising is crucial to news publishers’ success, but there’s a fundamental imbalance of power between them and platforms such as Facebook and Google whose overwhelming market dominance means they dictate the terms on which they use publishers’ content, including whether and how much they pay for it. 

“Publishers need platforms far more than the platforms need them and are disadvantaged by a dysfunctional online advertising market.   

“It’s essential that the government acts swiftly to remedy this and sets up the Digital Markets Unit as a matter of urgency. The possibility that it could be delayed until 2022 or later is unacceptable - the news industry can’t afford to wait that long.” 

The News Media Association welcomed the Government’s response to the CMA’s market study saying: “We welcome the Government’s response today to the CMA’s market study into the digital advertising market which unearthed evidence of systematic anti-competitive behaviour and the detriment this is causing, not only to publishers but to advertisers and consumers.

“The NMA has called for a dedicated Digital Markets Unit to regulate the tech platforms and a code of conduct to govern the relationship between publishers and the platforms. This should include a statutory obligation for the platforms to carry and surface news publishers’ content and to pay for its use. We are pleased that the Government has accepted the CMA’s recommendations and committed to setting up the DMU and an enforceable code which will help underpin a sustainable future for journalism. We urge the government to implement these without delay.” 

To read more on this:

The Telegraph, FT, City AMThe Times & Press Gazette 

27/11/20

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