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Online regulator launched aimed at curbing Big Tech’s dominance

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The UK has introduced a new online regulator aimed at ensuring tech giants such as Facebook and Google cannot exploit their market dominance to crowd out competition.

The Digital Markets Unit (DMU), which is based in the Competition and Markets Authority (CMA), will oversee government plans to give consumers more choice and control over their data as well as promote online competition.

Oliver Dowden, Britain's digital secretary, has already tasked the DMU with creating a code to govern the relationships between platforms and content providers, such as news publishers, to ensure they are as fair and reasonable as possible.

However, while the new DMU body may give the appearance that the government is taking tough action to regulate tech giants, it currently has no powers until the proposed Online Harms Bill is brought into legislation. The bill, which will make Ofcom the regulator of online harms and allow them to fine internet companies up to ten per cent of their turnover, was first introduced nearly two years ago but has yet to be introduced to parliament.

The government hopes that the DMU will help to tackle “the concentration of power among a small number of firms” that is curtailing growth and having negative impacts on consumers and businesses on the internet. It will begin looking at how codes of conduct could be used to govern the relationship between these groups.

“Today is a major milestone in the path to creating the world’s most competitive online markets, with consumers, entrepreneurs and content publishers at their heart,” Dowden said.

“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.

“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.”

The Labour Party has previously criticised the government for dragging its feet over the introduction of online harms legislation.

Andrea Coscelli, chief executive of the Competition and Markets Authority (CMA), said: “People shopping on the internet and sharing information online should be able to enjoy the choice, secure data and fair prices that come with a dynamic and competitive industry.

“Today is another step towards creating a level playing field in digital markets. The DMU will be a world-leading hub of expertise in this area and when given the powers it needs, I am confident it will play a key role in helping innovation thrive and securing better outcomes for customers.”

Around £14bn was spent on digital advertising in the UK in 2019, around 80 per cent of which was spent on Google and Facebook. Google recently threatened to block access to its search engine in Australia over the country’s plans to force it to pay news outlets for their content.

Last month, Ofcom announced plans to open a new technology hub in Manchester, creating up to 150 new jobs by 2025, as it gears up to become the regulator for internet companies under the proposed Online Safety Bill.

On the same day, underscoring the urgent need to progress the Online Safety Bill, the NSPCC revealed that more than half of the online child sex crimes in one year had taken place on Facebook-owned apps. 

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