ACCC to explore state of competition in social media

The Australian Competition and Consumer Commission (ACCC) has announced that its sixth report from the Digital Platform Services Inquiry will examine the state of competition for social media services in Australia.

The company has launched a consultation focused on issues including barriers to entry and expansion faced by new platforms, as well as the hurdles and costs faced by consumers and businesses when they try to switch social media services.

The sixth interim report will also consider potential consumer issues including how businesses are using social media advertising services such as display advertising, sponsored posts and paid influencers to advertise to consumers.

In addition, the regulator will explore the use and abuse of the social media platforms for scams in light of the growing threat they pose to Australians. The regulator estimates that Australians lost more than $144 million to scams on social media in 2021, almost double the amount recorded in 2020.

ACCC Chair Gina Cass-Gottlieb said as part of the inquiry, the regulator will seek to examine trends in user preferences and engagement over time, and consider how users choose social media services.

“Social media has become an essential tool for many businesses as they seek to widen their customer bases and engage and communicate with consumers, and for individual consumers to connect and communicate with each other and access critical information,” she said.

“We want to hear from businesses and consumers about their experiences with social media services, including with Facebook, Instagram, Twitter, TikTok and Snapchat. We are also eager to receive feedback on the barriers to entry and expansion for social media services in Australia, and if new entrants such as TikTok have changed the competitive landscape for social media services in Australia.”

Submissions to the consultation close on 9 September.

Image credit: iStock.com/P. Kijsanayothin