Australia: Near monopolies in a fragmented market: ACCC targets ad tech in Digital Platforms Inquiry Report

Last Updated: 30 September 2019
Article by Lisa Fitzgerald and Madison Tonkes
Most Read Contributor in Australia, September 2019

In its final Digital Platforms Inquiry Report (Report), the ACCC raises significant concerns over a number of competition and privacy issues impacting the ad tech supply chain relating to online advertising. The Report makes a number of recommendations, which, if implemented, will shake-up the industry and bring on a slew of changes for all players involved in programmatic advertising.

Online advertising makes up an increasing portion of the total advertising spend in Australia. Facebook and Google are the two largest suppliers of online advertising. Outside of these two suppliers, the advertising market is highly fragmented and extremely complex. Other providers include online news publishers, online marketplaces like eBay and other types of digital platforms like Reddit and Amazon as well as media agencies. But don't think it stops there. There are also, for example, supply side platforms, demand side platforms, ad exchanges, ad networks, advertiser ad servers, data management platforms and trading desks.

What is the 'monopolising' concern of the ACCC?

Despite the fragmented ad tech marketplace, the ACCC estimate that Facebook and Google captured in excess of 80 per cent of growth in online advertising in the past three years. The report refers often to monopoly and near monopoly concerns and its potential impact on competition and privacy.

How does ad tech work?

In essence, ad tech is about delivering advertising campaigns online in a targeted way to the most relevant consumers as assessed and sold against metrics known as 'cost per impression', cost per action', 'cost per click' and 'cost per lead'.

The majority of online advertising occurs through search advertising (ads which appear on search engines as a result of a search query) and display advertising (ads which are made up of visual elements and appear alongside website content, including social media content).

Google is by far the most common means of purchasing search advertising. The ACCC estimates that 96 per cent of search ads are obtained this way in Australia.

Display ads are purchased through four primary channels: Facebook, Google, ad tech services and direct deals. To generate display ads, the website collects user data via first and third party cookies when the user requests to access the website. The website and personalised display ads are then generated to the user.

What is at risk in the online advertising marketplace?

This trend in online advertising raises a number of issues of concern for the ACCC:

  • anti-competitive conduct and risk of market failure: According to the ACCC, there is the potential for market manipulation given that it is unclear how Google and Facebook choose to rank and display advertisements and to what extent these platforms self-preference their related platforms or businesses in which they have interests. The market dominance of Google and Facebook was a major concern for the ACCC, as due to the present market structure, agencies were being incentivised to "act in ways that benefit their own interests and are to the detriment of advertisers". The ACCC is not alone in suspecting self-preferential treatment, with this concern being shared overseas. Indeed, in 2017 the European Commission fined Google $2.4 billion Euros for using its market dominance to give prominent placement to its own comparison shopping service (Google Shopping) by demoting rival comparison shopping services.
  • lack of transparency in online advertising services: The ACCC notes there is also a significant lack of transparency as to the prices charged by online advertisers and the proportion of value appropriated by firms operating at different levels of the ad tech supply chain. The convoluted opacity generated by various algorithms and blistering auction processes leads to a lack of trust between consumers and online advertisers which the ACCC warns could distort competition and prompt a "race to the bottom" phenomena.
  • privacy concerns: In its Report, the ACCC recommends that the collection of any consumer data (for the use of advertising or otherwise) needs to be obtained through freely given, specific, unambiguous and informed consent, unless such collection is necessary for the performance of a contract to which the consumer is a party. Practically speaking, this will require entities to obtain an 'opt-in' style consent from users where their data will be collected for advertising purposes. Importantly, this will differ considerably from the common practice of bundling user consents. If this recommendation is adopted in Australia, it will have a major impact for all Australian businesses in the advertising industry and will significantly reduce the volume of data collected from consumers for advertising purposes.

In addition to its recommendation to adopt a mandatory 'opt-in' style consent for the collection of users' data, the commission recommends the establishment of a specialist digital platforms branch which will hold an inquiry into the competition for the supply of ad tech services and online advertising services by advertising and media agencies.

These recommendations will have significant impact for any Australian businesses engaged in programmatic advertising. The government is currently in the process of reviewing the ACCC's recommendations before it makes its final decision.

With this in mind, it would be prudent for any Australian businesses who utilise online advertising to stay up to date on any impending developments in this space.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions