The ACCC is concerned about the state of competition in the digital advertising industry. That means that everyone in the industry should be concerned too.
First, there is Google and Facebook's stranglehold on digital advertising markets. The ACCC is suspicious that they will use their dominance to give themselves an unfair advantage. The suspicion is based largely on their form overseas. For example, in Europe the EC has fined Google €1.49B for limiting websites' ability to use competitors to its Adsense products. In the UK, a report suggests that Facebook limited competitor apps' access to data.
The ACCC can see all the ways that Google and Facebook have the ability and incentive to take advantage of their power in search and display advertising. Favouring their own inventory, ranking their own services higher in search and social media feeds, refusing rivals access to key apps like the Google Play Store, favouring their advertisers in organic search results or news feeds, and bundling vertically integrated services.
The problem is that they can't get past the hypotheticals. They don't have data or evidence to assess whether the behaviours are actually occurring here. The ACCC's solution is more power to proactively investigate and monitor the platforms. It is setting up a specialist digital platforms branch. And it wants to establish better dispute resolution options for everyone who deals with big platforms like Facebook and Google.
The ACCC is also concerned about agencies' role in the murkiness of the digital advertising supply chain; specifically, how they inhibit competition and hide money from advertisers. The advertising industry has been talking about transparency for a few years now. (We wrote about it here.) Agencies taking rebates to which they're not entitled, hiding money and free inventory from advertisers, that kind of thing. At the least its misleading or unconscionable. At worst, it's criminal. It's surprising that the ACCC hasn't picked up the problem. Until now.
To investigate this properly, the ACCC wants to hold an inquiry into competition in online advertising, focusing on advertising and media agencies. If this goes ahead, agencies involved in illegal rebate schemes could face prosecution. Media owners might too, if they have knowingly helped facilitate the agencies doing the wrong thing.
The lack of action until now may be because advertisers have seemingly tolerated this kind of behaviour. In an ACCC inquiry though, advertiser apathy won't offer any protection. Agencies and media owners should prioritise compliance now and make sure their dealings will stand up to scrutiny.
We do not disclaim anything about this article. We're quite proud of it really.