25 Jul 2024 Final digital platforms report to focus on global developments and emerging competition and consumer issues The tenth and final report of the ACCC’s Digital[...]

The tenth and final report of the ACCC's Digital Platform Services Inquiry will provide an update on recent developments in digital platform markets, identify emerging issues and chart major developments overseas and their impact on consumers and competition.

By outlining potential or emerging issues, the ACCC is seeking to highlight priorities for further consideration or monitoring, noting that digital markets continue to evolve.

Today, the ACCC has published an issues paper , which summarises these three areas of interest for the upcoming final report and asks stakeholders to provide input on these issues.

"The report will be a chance to take a global view and see what challenges and opportunities exist worldwide. The ACCC's work on digital platforms over the past five years has already led to changes in our economy and to benefits for consumers. But Australia can learn and benefit from developments elsewhere," ACCC Chair Gina Cass-Gottlieb said.

"We are now asking consumers, business owners and others to share their views on the issues we outline so that they can help shape the final report."

The issues paper outlines significant advances in relevant legislation in the European Union, Germany, India, South Korea, Japan, and the UK. The final report may provide further detail on these and other jurisdictions, including further developments occurring before publication of the report.

"We recognise that in many cases international legislation is only recently enacted so the full impact may not be clear. But many jurisdictions have matched our ambition in finding a balance between competition in the digital marketplace and protecting consumers," Ms Cass-Gottlieb said.

Updating earlier observations of the Digital Platform Services Inquiry

In the final report, the ACCC also intends to provide updated information relating to some of its observations from earlier reports of the Inquiry.

The September 2020 report on Online Private Messaging and the March 2021 Report on App Marketplaces are two areas where there may be room for updates to previous observations. However, the ACCC may consider other major developments and key trends observed in services or markets examined in additional earlier reports as required.

The ACCC will examine changes to the offerings of these services, including as a result of recent technological advancements. The report will also identify adjustments in the scale and identity of the key suppliers of these services, including where there are new entrants. It will also look at changes in the way that consumers are using services and examine any shifts in views regarding trust and quality.

The ACCC may also report on recent and current legal action domestically and internationally, including Epic Games' current action against Apple and Google underway in Australia. Epic Games and class action lawyers representing smartphone users and app developers have alleged Apple and Google have each contravened various provisions of the Competition and Consumer Act.

Emerging issues in digital platform services

As part of the final report, the ACCC will consider potential or emerging competition and consumer issues in digital platform services in Australia which have not previously been examined, such as online gaming.

Online video games and gaming platforms are a popular form of entertainment and social connectivity in the digital age, estimated to have a total market value of $4.21 billion in 2024, as about 91 per cent of Australian households own a video game device or console.

The ACCC has not previously examined competition and consumer issues in online gaming markets but observes there could be current practices in the industry which may give rise to potential competition and consumer concerns.

Among the potential issues for examination in the final report are distribution and subscription models, and an examination of design elements which may be deceptive.

The ACCC also proposes to examine potential competition issues relating to generative AI. These may include considering the high barriers to entry in the market and the potential for large digital platforms to strengthen and expand their market power through the integration of Large Language Models (LLMs).

"We are following recent developments in generative AI closely. Adoption has been extensive, and this technology continues to expand and develop at a rapid pace. Generative AI products and services may present new opportunities, but also new challenges with major implications for our work," ACCC Chair Gina Cass-Gottlieb said.

The current ninth interim report of the ACCC's Digital Platform Services Inquiry, due to Government in September 2024, is considering competition and consumer issues in relation to general search services in Australia, including the potential impact of generative AI as it relates to general search services. Given this current focus, the ACCC is not proposing to further consider the potential impact of generative AI on general search services in the final report. In its September 2023 report, the ACCC examined consumer cloud storage as an example of the expanding ecosystems of digital platforms.

Given this past focus, the ACCC does not intend to revisit consumer cloud storage as part of its consideration of this topic. However, the ACCC notes that cloud storage is only one aspect of cloud computing services and intends to focus its consideration on the other offerings, such as access to networks, servers, applications, and storage with a focus on business users.

Consumers, businesses and interested parties are encouraged to make submissions to [email protected] by 23 August 2024.

Background

The ACCC's Digital Platforms Branch is conducting a five-year inquiry into markets for the supply of digital platform services in Australia and their impacts on competition and consumers, following a direction from the Treasurer in 2020. The inquiry reports to the Government every six months and examines different forms of digital platform services, their advertising services as well as data brokers.

This issues paper will inform the ACCC's tenth report due to be submitted to the Government by 31 March 2025.

The ACCC's ninth interim report, which focusses competition on general search services and trends in search quality, is due to the Treasurer by 30 September 2024.

Other reports have examined: online private messaging services, market dynamics and consumer choice screens in search services and web browsers, app marketplaces, online retail marketplaces, regulatory reform, social media services and expanding ecosystems.

Previous reports are published at Digital platform services inquiry 2020-25.

In the fifth interim report of this Inquiry provided to Government in September 2022, the ACCC recommended new competition and consumer protection measures for digital platforms to address various harms observed in the supply of digital platform services. On 8 December 2023, the Government provided in-principle support for all of these recommendations and noted it would publicly consult on a legislative framework for the competition measures.

The ACCC notes that several other government activities on the broader issues in generative AI are currently underway, including the Department of Industry, Science and Resources' 'Safe and Responsible AI in Australia' consultation, and the House Standing Committee on Employment, Education and Training's inquiry into the use of generative AI in the Australian education system.

Public link

Please use the above public link if you want to share this noodl on another website.