Nadine Dorries to press ahead with competition crackdown on big tech

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Nadine Dorries is to press ahead with the creation of a new digital competition watchdog that will have the power to levy multi-billion pound ends on US tech giants which abuse their dominance of the internet.

The Culture Secretary is setting up a Digital Markets Unit that will be given statutory powers to help it investigate alleged anti-competitive behavior by the likes of Google and Facebook.

The unit, which will sit within the Competition and Markets Authority, will be able to hand out ends of up to 10pc of global turnover and penalize bosses for the most serious breaches in a bid to spur competition and protect consumers.

It intends to change rules so that users can more easily switch between Apple and Android phones without losing contacts and data, as well as providing users with more choice online.

The unit also plans to force tech giants to reveal the secrets of algorithms to smaller firms, and to ensure news publishers are paid properly for their online content.

It could force companies to suspend or reverse actions it believes has broken its rules.

In a consultation response published on Friday, the Department for Culture, Media and Sport (DCMS) will reveal that it intends to launch a “code of conduct” for the biggest companies on treating consumers and firms fairly.

However, ministers will promise a light touch approach on takeover rules amid fears a clampdown could hit investment.

Digital Minister Chris Philp said the “dominance of a few tech giants is crowding out competition and stifling innovation”.

He added: “We want to level the playing field and we are arming this new tech regulator with a range of powers to generate lower prices, better choice and more control for consumers while backing content creators, innovators and publishers, including in our vital news industry.”

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It is not yet known when the legislation will be introduced. It is understood the plans could be referenced in the Queen’s Speech despite fears they would be left out entirely.

Plans to force big tech companies to reveal details of their algorithms and to give notice of upcoming changes are likely to prove popular with businesses.

Algorithms are regarded by tech companies as highly valuable trade secrets. In a 2020 High Court case brought by a rival, Google described its search ranking algorithms as its “crown jewels” while fighting an attempt to have them inspected by an external consultant.

Facebook has faced multiple controversies over its Feed ranking algorithm, including allegations last year by Frances Haugen, a whistleblower, that European political parties were taking more extreme positions to maintain their prominence in the face of algorithm changes.

An update which increased the prominence of Facebook posts with more user comments pushed politicians into creating more divisive online content, said former social network employee Ms Haugen, citing internal documents she said she had seen in 2018.

Addressing tech companies’ practices, DCMS said: “Any changes in their algorithms could mean that traffic is steered away from certain sites and businesses which could have a negative effect on their revenue.”

Facebook and Google alone claimed 35pc of the world’s $641bn digital advertising budget during 2020, according to figures compiled by GroupM, a subsidiary of advertising company WPP.

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www.telegraph.co.uk

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George Holan

George Holan is chief editor at Plainsmen Post and has articles published in many notable publications in the last decade.

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