The authority aims to monitor the concentration of power among a small number of large technology companies, as the concentration of power hurts consumers and small businesses alike.
The new subsidiary agency for technology, called the DMU, is located within the Competition and Markets Authority (CMA), the current agency that regulates anti-competitive behavior in the wider marketplace.
The Digital Markets Unit’s first task will be to examine the relationship of major tech companies with online advertising, including the nearly 14 billion pounds ($ 19.2 billion) spent via digital advertising in the UK in 2019.
About 80 percent of that amount went to just two companies, Google and Facebook.
“The Digital Markets Unit has been launched and I have asked it to start looking at the relationships between platforms, content providers, digital platforms and advertisers,” the UK’s Minister of Digital Technology said in a statement.
The minister continued: This paves the way for the development of new digital services, lowers prices, gives consumers more choice and control over data, and supports our news industry, which is vital to freedom of expression and our democratic values.
Companies like Facebook and Google have captured the online advertising market, leaving traditional media companies without much advertising revenue, even after setting up their internet businesses.
Describing the new body as pro-competitive, Britain’s business secretary said it helps curb the domination of tech giants by allowing smaller tech firms to thrive.
While the EU is able to impose heavy financial sanctions on big tech companies for their anti-competitive behavior, the UK has been playing catch-up since it left the EU.
Some smaller companies have ventured back to the big tech firms’ destruction of the domestic press market, such as when Australia created a so-called media blog that proposes sharing profits between tech firms and news firms.
Big tech companies and the Australian government have reached a negotiated agreement on giving news outlets a small portion of the profits, but this is likely just the beginning, not the end, of these confrontations internationally.
The UK will likely try something similar to Australia’s plan in the very near future.