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Big Tech’s ad business can be a monopolist threat: Standing Committee on Finance

The committee also recommended that the government should consider and introduce a Digital Competition Act to ensure a fair, transparent and contestable digital ecosystem.

By  Tasmayee Laha RoyDec 23, 2022 3:51 PM
Big Tech’s ad business can be a monopolist threat: Standing Committee on Finance
The report said, “It should provide advertisers information on a daily basis, regarding price paid by the advertiser and the remuneration received by the publisher. It should provide advertisers and publishers with access to the performance measuring tools of the gatekeeper and the data necessary for advertisers and publishers to carry out their own independent verification of the advertisements inventory, including aggregated and non-aggregated data." (Representative Image: Aman Pal via Unsplash)

Digital India has seen unprecedented growth but some companies are taking the lion’s share of ad money and data control. The Parliamentary Standing Committee on Finance in a report said that ‘Big Tech Company's ad business is a monopolist threat as it owns every step in a system that connects ad sellers and buyers and give the Big Tech companies an unfair edge over the market’.

The leading players in the space according to the report can strategically leverage their position in the market to cut off innovative start-ups, thereby eliminating competition.

“This creates entry-level barriers for an emerging firm. Moreover, it leads to the entrenchment of the leading firms market position and strength,” says the report.

According to the committee there is an immediate need for regulatory provisions to ensure that news publishers are able to establish contracts with these SIDls (systemically important digital intermediary) through a fair and transparent process.

The committee recommended that in the name of online advertising a SIDI should not process personal data of end users using services of third parties that make use of core services of the platform.

“It should provide advertisers information on a daily basis, regarding price paid by the advertiser and the remuneration received by the publisher. It should provide advertisers and publishers with access to the performance measuring tools of the gatekeeper and the data necessary for advertisers and publishers to carry out their own independent verification of the advertisements inventory, including aggregated and non-aggregated data,” said the report.

Findings of the committee also say that there is a need for India to enhance its competition law to address the unique needs of digital markets.

“Unlike traditional markets, the economic drivers that are rampant in digital markets quickly result· in a few massive players dominating vast swathes of the digital ecosystem," the report said.

The Committee therefore recommended that the government should consider and introduce a Digital Competition Act to ensure a fair, transparent and contestable digital ecosystem, which will be a boon not only for our country and its nascent start-up economy but also for the entire world.

Among other suggestions made by the committee in the report, there is also one that requires India's competition law to be enhanced.

The Committee says a specialized Digital Markets unit could be established within the Commission, staffed with skilled experts, academics and attorneys, enabling the Commission to closely monitor SIDls and emerging SIDls, provide recommendations to the Central Government on designating SIDls, review SIDI compliance and adjudicate on digital market cases and conduct for efficient and effective monitoring of digital markets per se.

First Published on Dec 23, 2022 3:44 PM