Australia’s consumer regulator has suggested tougher regulation is on the way for online platforms as it sharpens its focus on the collection and use of people’s data by Google and other tech giants.
The ACCC is currently in two legal battles with Google over the collection of consumer data, is conducting an inquiry into online advertising services – an industry dominated by Google and Facebook – and is establishing a dedicated Digital Platforms Branch to “systematically” monitor a wide range of digital platforms’ operations for the next five years at least.
The regulator is also still mulling proposed acquisitions of Fitbit and Giphy by Google and Facebook respectively.
The increased scrutiny follows the regulator’s landmark 18-month Digital Platforms Inquiry which found systematic problems with online platforms and that Google and Facebook have become “unavoidable trading partners”.
An update from ACCC Chair Rod Sims last week signalled a further move of the regulation of data collection and processing in Australia from the privacy regulator, the OAIC, to the ACCC, a more resourced and litigious regulator.
Sims said the ACCC now considers consumers providing their data as a way to “pay” for a service, potentially further opening up the platform companies to consumer laws, widely considered more enforceable than Australia’s ageing privacy laws.
Speaking to the Australia-Israel Chamber of Commerce on Thursday the competition tsar said leading digital platforms like Google and Facebook have become invaluable to people and businesses but are also “economic powerhouses capable of dominating any markets they decide to enter”.
And while the tech giants often purport to offer “free” online services, the tradeoff is typically the sacrifice of personal information to the tech giants – a bargain the regulator sees as one-sided.
“There is an obvious power imbalance and information asymmetry between digital platforms and consumers, but we believe that consumers have the right to know and make an informed choices about their use of those services, particularly how their personal data is being collected and used.”
Sims suggested traditional regulatory frameworks are no longer sufficient to police the operation of digital platforms and their data processing.
“Existing regulatory frameworks have not held up well to the challenges of digitalisation, and so this is now a core focus for us, as it needs to be.”
Google goes to court (again)
Last month the ACCC began legal proceedings against Google, alleging it didn’t have the correct form of consent from millions of Australians consumers when it began combining their internet browsing activity with their Google account data in 2016.
“Our primary allegation is that, from 28 June 2016, Google fundamentally changed the way it used sensitive data about what account holders did on non-Google websites and apps, without adequately informing consumers,” Sims said on Thursday.
“It might not surprise you that millions of Australian account holders clicked ‘I Agree’ and happily went on with their day,” Sims said.
“What those millions of Australians might not have realised was that, by clicking ‘I Agree’, they essentially allowed Google to tie the data that it collected about their activity on non-Google websites and apps that use Google technology to the personal information associated with their Google accounts.”
Google makes hundreds of billions of dollars each year and almost all its revenue is generated through online advertising services built on user data.
Google denies the ACCC’s allegations and says it intends to defend its position in the Federal Court.
A Google spokesperson told Which-50 last month, “The changes we made were optional and we asked users to consent via prominent and easy-to-understand notifications. If a user did not consent, their experience of our products and services remained unchanged.”
The ACCC is also pursuing Google in a separate matter regarding the collection of location data by the tech giant. The regulator alleges Google misled consumers into sharing their locations with the company, which was then used to enhance the value of its advertising services.
That matter is currently in court with a hearing scheduled in late November.
Sims said: “These enforcement actions are about holding powerful digital platform businesses accountable for their representations to consumers and ensuring consumers are fully aware of the price they pay, through their data, for the supposedly free services they receive.”