The Competition & Markets Authority has finally launched its investigation into the way Google and Facebook dominate the £13bn UK digital ad market, in a bid to determine whether “consumers are able and willing to control how data about them is used and collected”.
The move was first revealed in March, when Chancellor Philip Hammond called for a review the digital advertising market after recommendations made in an independent report for the Treasury by Barack Obama’s former chief economic adviser Jason Furman.
The CMA said it planned to examine concerns about how online networks were using people’s personal data, including “whether making this data available to advertisers in return for payment is producing good outcomes for consumers”.
The regulator will also investigate whether there has been any abuse of power by the US giants; it has been predicted that by next year the Google and Facebook duopoly will control more than 70% of the UK digital ad market.
And even though Amazon is set gate-crash the party, by 2020, Facebook will be bringing in an estimated £3.8bn in UK advertising spending; only slightly less than the value of the entire commercial TV market (£4bn).
CMA chair Andrew Tyrie, said: “Much about these fast-changing markets is a closed book to most people. The work we do will open them up to greater scrutiny, and should give Parliament and the public a better grip on what global online platforms are doing.”
Chief executive Andrea Coscelli added: “The market study will help us further lift the lid on how major online platforms work, especially how they collect and use personal data, how they monetise their content through digital advertising, and what this means for competition.
“The findings from this work will be used to influence the direction of policy and regulation in the digital sector.”
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