Microsoft has highlighted a number of contradictions in its response (PDF) to the Department of Communications' review of deregulation initiatives in the communications sector.
Microsoft Australia managing director Pip Marlow said there are immediate concerns with the government's intention to create new regulatory mechanisms for social media to take "harmful material down fast".
Currently, Microsoft and other technology companies that have social networking functionality are voluntarily handling complaints as part of a protocol that was organised under the previous government, which Marlow said is "working well".
She said any further changes are "unnecessary and would run counter to the government's stated deregulation agenda".
Marlow went on saying, "the step of legislating in this area is fraught" and it will raise difficult questions that the government would have to attempt to define, such as what is considered as a "large social media site" or "harmful material".
The Microsoft Australia chief noted the existing Australian government policy and risk management guidelines for storage and processing of Australian government information in outsourced or offshore IT arrangements, released in June 2013, had added "additional hurdles" for agencies considering cloud computing services.
Currently, federal government agencies are required to seek approval from their portfolio minister and the attorney-general before being able to host any personal data offshore.
In another submission, eBay recommended (PDF) that amendments be made to the Copyright Act, because current technology-specific regulations restrain the cloud computing model and create elevated risk for both consumers and internet intermediaries.
According to eBay, changes will mean cloud service providers will no longer be found liable of copyright infringements for allowing consumers to "exercise any fair dealing rights under a cloud service".
"This will facilitate the growth and expansion of online services useful to consumers. For example, program time shifting, online back-up, communication for the purpose of criticism, and review and reporting of news could be carried out using third-party services without the service provider risking liability," eBay wrote in its submission.