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20 September 2018

Chancellor Voices Concern Over Tech Giants’ Dominance

Chancellor Philip Hammond has launched a review into competition in the digital economy voicing concern that the tech giants “could be accumulating too much power in our new digital world.”

The first meeting of an independent panel led by former Obama advisor Jason Furman and tasked with looking at the UK’s competition regime in the context of the digital economy was hosted by the Chancellor at Number 11 Downing Street yesterday.

Philip Hammond hosted the meeting after formally appointing Professors Diane Coyle, Amelia Fletcher, Derek McAuley and Philip Marsden who will join Professor Jason Furman who is leading the review.

Mr Hammond said: “Our digital economy is one of the UK’s great strengths, employing two million people across the country. But people are concerned that the big players could be accumulating too much power in our new digital world. The work this panel is doing will help ensure we have the right regulations so that our digital markets are competitive and consumers are protected.”

Professor Furman added: “I am delighted to be leading such a strong panel of genuine experts in their respective fields of economics, technology and law. We help to ensure that the UK remains at the forefront of the global digital economy, and that consumers continue to benefit as innovative technologies develop and evolve.”

The review will investigate the UK’s competition regime in the context of the digital economy. It will look at how this affects consumers, and the impact of competition policy on the UK’s growth, productivity, wages and labour markets.

The News Media Association has been calling for a competition inquiry into the dominance of the tech companies and the role of intermediaries in the digital advertising supply chain and their impact on consumers, advertisers and other media players, leading to effective remedies.

Speaking at the Royal Television Society London conference this week, Culture Secretary Jeremy Wright said he would not rule out a levy on the tech giants to fund quality journalism which "our democracy depends on."

He said: "And as well as tackling sources of inaccurate information, we want to strengthen and support high quality sources that people can trust. High quality and properly researched journalism is the best possible weapon in our battle against fake news. And so the sustainability of our high quality media is something that should concern us all.

"In March we launched an independent review, chaired by Dame Frances Cairncross, to look at how the production and distribution of high-quality news journalism can be sustained in a changing market, with a particular focus on the online space."

He added: "A strong media means a strong democracy and a strong nation. And we cannot be complacent. Those sowing discord want to undermine this trust and the institutions upon which our liberal democracy relies. Trust is a precious commodity and bolstering it is vital to our future."

The review panel will run from September to early 2019. Its work will culminate in a final report of recommendations for the Government. Over the course of the review, the panel will meet with a wide range of academics, businesses and representative groups. The terms of reference have been published and a call for evidence will be launched shortly.