Competition authority launches digital advertising probe
Regulator investigating use of data and market power held by online platforms
The UK’s competition watchdog has launched its sweeping probe into online advertising and unveiled an investigation into the potential harm to customers from the power of social media platforms and technology companies.
The Competition and Markets Authority said it was investigating the way in which online platforms harvest customers’ data and “whether consumers are able and willing to control how data about them is used”. It also said it was looking into whether competition in the advertising market was being “distorted” by the market power held by online platforms.
The competition authority’s well-flagged Digital Market strategy is aimed at moving UK competition policy into line with the rapidly changing, and increasingly powerful, technology sector.
In February CMA chair Lord Tyrie demanded new powers for the competition body and said “new and rapidly emerging forms of consumer detriment” were stemming from the digital economy.
The CMA said on Wednesday it had been hard for consumers and public authorities to “keep up” with the “speed of change and the vast reach of major players” in the digital market.
It will now investigate the extent to which fake news and online harm are at work in the digital economy and look at whether the might of companies like Google and Facebook is resulting in a lack of competition among digital advertisers.
The CMA has been increasingly targeting harm to consumers through technology. It recently investigated online hotel booking sites and cracked down on the way social media “influencers” endorse products on social media and the role of the platforms they use.
The watchdog is seeking comments by July 30 including from interested parties such as online platforms, advertisers, publishers, intermediaries within ad tech companies, and will publish a final report next year.