Athira Sethu
Kochi, 2 December 2024
A new law in Australia proposes fines up to A$50 million (around $33 million) for global tech companies if consumers are not allowed to switch between services or harm competition. It focuses on the growing power of big tech companies and may protect consumers.
The law would arm the competition regulator of Australia to monitor online practices and even begin investigating anti-competitive behaviors. It could also impose penalties on companies found to limit competition. Assistant Treasurer Stephen Jones explained that the digital economy is changing too fast for old laws to keep pace. Big companies often use unfair tactics to keep consumers stuck with their services, thereby making it difficult for the new companies to compete in the market.
The proposed law might be a bit similar to the Digital Markets Act by the European Union, which would make switching between online services such as social media, web browsers, and app stores more accessible. It would also focus on the online platforms that have the greatest influence on competition, based on advice from the ACCC.
The government intends to focus first on app marketplaces and advertising services. This will stop companies such as Apple, Google, and Meta from manipulating search results to feature their own services or apps with poor ratings at the top. They would also not be allowed to favor their own products over third-party services.
For instance, Google dominates majority of the search services, controlling 93-95% of Australia’s internet. App Store accounts for up to 60% on the side of Apple while Google controls 40% through Play Store. On the social networking site, Meta’s application controls Facebook and Instagram together taking up 79% of internet space.
The new law is still under discussion and should be finalized by February 14. If passed, it may bring a change of tremendous proportions to how digital services operate in Australia.
