The Technology Secretary has warned that the biggest technology companies in the world will face harsh consequences if they treat users unfairly on-line.
Michelle Donelan, the author of Competition and Consumer Bill says that new rules will grant greater power to the competition watchdog in order to ensure that Big Tech doesn’t harm consumers through stifling competitiveness.
She explains the extent of the market power that companies have over the lives of people: “These firms are in control of everything, from the way we communicate online with one another to what products we see when we do a search online to the price we pay.”
She says, “We’ve all been there.” We search online for products we need, but only find the product at the best price in the fourth or fifth pages. The Big Tech companies have access to a vast amount of data on users and businesses that use their platforms, which allows them to strengthen their position as market leaders.
For violations of the new rules, the regulator can fine companies with a substantial and entrenched position in the market up to 10% of their global revenue. Directors will also be disqualified.
The Digital Markets Unit of the Competition and Markets Authority will scrutinise technology companies. These businesses will also be required to report mergers and purchases to the watchdog.
The new law is aimed at reducing the number of people who are trapped in expensive subscriptions.
In April 2021, the Digital Markets Unit (in shadow) was created. It consists of around 70 people ranging from data scientists to engineering. The unit has begun working, but won’t be able exercise its full power until the delayed legislation passes. The unit has so far begun an investigation of the market for mobile browsers and games.