UK aims to ‘defang’ Web giants with pro-competition rules

• UK’s Digital Markets Unit will oversee new competition rules
• The likes of Google and Facebook are in its sights
• The UK government believes the dominance of a few is bad for innovation and variety

The UK government is setting up a ‘Digital Markets Unit’ to defang Google and Facebook via tougher competition rules.

The Unit, announced today, will be established in April 2021 with a mission to prevent the big tech platforms from dominating media markets to the detriment of small firms, new entrants, and, of course, consumers. 

The Unit is a sort of bureaucratic joint venture involving the Department for Digital, Culture, Media and Sport (DCMS) and the Department for Business. 

The UK government makes no bones about the Unit’s oversight powers, which essentially walk back at least three decades of de- and self-regulation. It envisages that the Unit will enforce a statutory code of conduct governing commercial relationships and ensure that the platforms are not imposing terms that limit publishers’ ability to monetise their content. 

It will also force platforms to be more transparent about services and consumers’ data. 

The new Unit -- the kind of body needed by the British authorities in the upcoming Brexit era, when the UK will no longer be a party to similar efforts undertaken by the EU collective – will operate within the Competition and Markets Authority and will coordinate with communications regulator Ofcom, the Information Commissioner’s Office, and other bodies.

The focus of the Unit’s staff will be informed by the findings of the Digital Markets Taskforce, which is set to publish a report before the end of this year. The Taskforce was set up earlier this year to “provide advice to the government on the potential design and implementation of pro-competitive measures – including the methodology which will determine what companies should be designated as having strategic market status, and how a regime would work in practice,” noted the government in this press release, which identified Facebook and Google only by name as examples of the companies that will be monitored by the Unit.

It will have powers to suspend, block and reverse the decisions of tech giants, as well as the ability to order them to take certain actions to achieve compliance with the code, with the threat of financial penalties for those companies that fail to follow the rules.

It will be interesting to see whether the sort of “due process”, complete  with squeals, appeals and legal machinations we endured when the European Commission was in charge of policing big tech corporate behaviour, will blunt the impact of  this body. It’s early days and the unit is yet to be formed, but the straight-forward language and talk of “suspend, block and reverse” gives every impression that legal delaying tactics won’t be tolerated.