The UK’s New Big Tech Regulator Comes To Town

Big Tech

As of Wednesday (April 7) the U.K. has created a new Big Tech regulator for firms like Google and Facebook with the purported goal of protecting the nation’s competitive media landscape, and attempting to discover if a code of conduct could improve the balance of power between large digital platforms and official news publishers.

“This will pave the way for the development of new digital services and lower prices, give consumers more choice and control over their data, and support our news industry, which is vital to freedom of expression and our democratic values,” said U.K.  Digital Secretary Oliver Dowden.

The new Digital Markets Unit (DMU) functions as a sub-segment of the Competition and Markets Authority (CMA). It was formed after the CMA concluded in 2020 that Google had significant market power in search and in search advertising, and Facebook had significant market power in social media and in display advertising and that existing controls were insufficient to prevent either from abusing their tremendous market power.

Business Secretary Kwasi Kwarteng noted that while the United Kingdom is and intends to remain a tech hub, the goal is to be a competitive business environment with room for small firms and new entrepreneurs.

“Our new, unashamedly pro-competition regime will help to curb the dominance of tech giants, unleash a wave of innovation throughout the market and ensure smaller firms aren’t pushed out,” Kwarteng said.

One might stop to question, however, if this new “unabashedly pro-competition regime” has perhaps cast Big Tech as the bad guy in this narrative in a way that is neither entirely fair nor productive. As Karen Webster pointed out in a commentary last year, taking on a “Big Tech is bad” attitude tends to lump a lot of companies together as a class and blame everyone for the actions of one or two — and leads to suspicion of things that are actually totally normal in the course of doing business, like making acquisitions.

Moreover, she noted, there seems to be an obsession with protecting consumers from the big bad tech firms, despite the fact that by and large consumers aren’t feeling particularly harmed.

“Consumers like these companies. A lot. The 2019 Morning Consult survey found that Amazon and Google were the second and third most trusted brands among consumers,” Webster wrote.

“Periodically, PYMNTS does surveys of various services in which we ask people what firms they would trust to provide them. These studies aren’t about Big Tech, but we happen to include Big Tech and Other Tech among the choices provided. Generally, people place a high degree of trust in Big Tech and Other Tech companies to provide them with a variety of critical services, including banking and financial services, compared with other companies,” Webster added.

And its not sorcery or brainwashing bringing on all this positive regard for these companies — they’ve managed to provide services and conveniences that consumers really like and value. People like using Google to search, and there’s nothing stopping them from using Bing except the fact that it isn’t very good. Consumers like having Amazon deliver goods to their door in one day flat, and they like getting out of an Uber without having to fumble with cash. It might not be fair to say these firms are anticompetitive merely because they happen to offer services consumers find so compelling that they are using them to the exclusion of others.

But while it might not be fair to cast Big Tech as the bad guy in the ongoing digitization fairy tale unfolding worldwide, it is probably equally fair to say that it doesn’t deserve being cast as the undisputed hero. Webster noted that “it is almost certainly the case that some Big Tech firms have done anticompetitive things, and perhaps they have acquired some small rivals they shouldn’t have.”

Regulation to reign in abuses and violations of consumer privacy and expectations aren’t a totally unwarranted course of action. But creating legislation and legislative bodies that seem bent on regulating to punish Big Tech for being Big Tech doesn’t seem like a solution.

 

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