Google rejects ACCC's calls to have tougher scrutiny over Australian operations

The search giant believes that if the consumer watchdog holds any particular concerns, it is welcome to investigate under existing Australian law.

Google has taken aim at claims made by the Australian Competition and Consumer Commission (ACCC) in its digital platforms review, rejecting the idea its business requires tougher regulatory scrutiny in Australia.

The comments follow the ACCC recently putting its spotlight on Google and Facebook, determining in December that the substantial market power of the two companies called into question the validity of information that is available and shared on their respective platforms.

In launching the Digital Platforms Inquiry Preliminary Report [PDF], ACCC Chair Rod Sims said the world has found itself in a position where such market power is held by a handful of entities, and that they need to be held accountable and placed under the microscope for additional scrutiny.

According to the ACCC, approximately 19 million Australians use Google; 17 million access Facebook; 17 million watch Google-owned YouTube; and 11 million access Facebook-owned Instagram each month.

In its 74-page rebuttal [PDF], Google said that additional regulatory oversight of favouring and news ranking, as put forward by the ACCC, was unnecessary.

"The Preliminary Report does not identify any instances in which Google allegedly favours its own products that is anticompetitive. Should the ACCC believe there are credible concerns in the future, it has the power and authority under existing law to investigate them," it wrote.

"The Preliminary Report also provides no evidence that regulatory review of Google's algorithms and potential recommendations for more disclosure about Google's news ranking would lead to higher quality search results as opposed to incentivising gaming of Google's algorithms."

Rejecting claims of anti-competitive behaviour where favouring its own offerings was concerned, Google said where it offered up consumers relevant results, most of these cases did not present any competitive concern.

"In display advertising, the Preliminary Report makes no finding that Google has market power and does not allege any specific anticompetitive favouring," it wrote. "In fact, the Preliminary Recommendation is based on a few hypothetical scenarios that are either implausible or unlikely to be anticompetitive."

Pointing to investigations of Google's search and search advertising around the world, the company said each had been conducted under existing competition laws, and said there was no need internationally, let alone in Australia, to create new sectoral regulators or regulations.

Similarly, Google said publisher concerns about referral traffic did not justify new regulation.

"We believe government regulation of our search results with regard to the treatment of certain news publishers' content should be considered only in response to the strongest, clearest evidence of harm to consumers," it added.

"The Preliminary Report does not find any such evidence -- to the contrary, the Preliminary Report correctly explains that Google has an interest in providing relevant news results to users. There is also no evidence that Google is reducing search result quality in order to divert traffic from news publishers."

Disputing the Preliminary Report's finding of market power in "news media referrals", Google said the ACCC's claim that the search giant provided 28 percent of referrals to news publishers was incorrect, and that Google only accounted for approximately 18 percent of total traffic received by the top 40 Australian news sites through apps, direct navigation, and third-party sites.

"The Preliminary Report also does not explain how a regulator would be better equipped to determine the optimal amount of disclosure about Google's ranking algorithms," the submission continued, speaking to the ACCC's concern that its search result algorithm lacks transparency.

"The Preliminary Report suggests that digital platforms may incentivise sites to promote 'emotive click bait' (primarily social media) and do not 'reward' original content. We design our algorithms to rank high quality content over so-called 'click bait', and the Preliminary Report does not provide any evidence to the contrary."

On the issue of ranking of "original content," Google said its Webmaster Guidelines cautioned sites against duplicating original content, but it said that in some cases, this was unavoidable, for example when newspapers ran articles from a wire service.

Google also said it firmly believed that any privacy-related recommendations made by the ACCC should apply to all organisations that are currently subject to the Privacy Act, not just digital platforms or organisations that meet a particular threshold.

Also taking aim at the ACCC's recommendation to have a news and digital platform regulatory oversight authority, Twitter said in its submission [PDF] that efforts to monitor, investigate, and report on the ranking of news and journalistic content on its platform would not be appropriate, as Twitter uses algorithms "very differently to other services".

"Our news algorithm is not dictated by the platform; it is dictated by the user's choices on who they follow," the company wrote.

"Currently, we use policies, human review processes, and machine learning to help us determine how tweets are organised and presented in communal places like conversations and search. We're tackling issues of behaviours that distort and detract from the public conversation in those areas by integrating new behavioural signals into how tweets are presented."

Twitter said there is a poor understanding of the consequences of exposing algorithmic decisions and machine learning models to hundreds of millions of people, and that safeguarding against individuals or groups seeking to game or exploit its algorithms is essential.

Where takedown notices could be issued by the Australian Communications and Media Authority (ACMA) for copyright infringing content, as put forward by the ACCC, Twitter said it was a "significant departure" from the current legal standards for issuing take-down notices that are relied upon by digital platforms and online service providers around the world.

Twitter considers its own copyright procedures to be adequate.

On data collection and use, Twitter said that while external audits could be useful, they are expensive, disruptive to the business, and capture point-in-time compliance as opposed to promoting consistent sustainable practices.

"We also believe the ACCC's final report would benefit from a more nuanced understanding of the wide range of reasons digital platforms collect information outside of targeted advertising," it wrote.

"It is important to understand that data needs to be collected in order to ensure the basic operation of digital services.

"It is natural that the data that underpins the operation of the service is also used to provide the ad."

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