How can the regulator take on Big Tech’s vice-like grip of digital markets? - Rocio Concha

The Competition and Markets Authority (CMA), the regulator in charge of competition in this country, has found itself in the headlines quite a lot recently.

Not all of it has been complimentary.

When the regulator blocked Microsoft’s recent acquisition of video games company Activision Blizzard, it said its reason for doing so was to protect innovation and consumer choice in the cloud gaming market.

The aftermath of the decision from the regulator led to Activision Blizzard’s boss calling the UK “closed for business”.

The recent media interest in the competition regulator’s decision is at least in part down to different approaches from regulators around the world.

Its European equivalent approved the Activision deal, while America’s competition regulator also tried to block the merger, but failed - putting pressure on whether the CMA could stand alone as the only regulator to block the deal from going through.

The CMA has since said it will reopen the investigation, but only after Microsoft came back to the table with a new offer - and a large concession which highlights that the regulator was right to raise concerns about the deal in the first place.

The proposal will give a French-based games rival Ubisoft the rights to distribute Activision titles on PC and console outside of the European Economic Area.

The case is of particular interest because the government is currently legislating as part of the Digital Markets, Competition and Consumers Bill to empower the Digital Markets Unit (DMU), which will operate out of the CMA.

The DMU will regulate a handful of the biggest tech companies in the world - many of which we use every day to work, find information, keep in contact with friends and family and to buy a huge range of products and services.

The dominance of a handful of tech giants can at times feel overwhelming.

According to research from data gathering platform Statista, Google holds a share of around 85 per cent of the global desktop search market.

The phrase “Google it” has now become synonymous with looking something up on the internet.

In second place? Bing with around 8 per cent.

The consequence of Google’s dominance doesn’t just mean less choice for consumers, but a virtual shutting out of other businesses vying for a slice of the pie.

The more search data Google gathers, the more it improves its search results, thus improving the product and compounding its advantage.

How can Bing, or other platforms such as Brave or DuckDuckGo, compete?

On the government’s website, you are free to read an explainer from the Prime Minister Rishi Sunak qhich is titled ‘10 ways we're making the UK the best place for tech businesses’.

The CMA/DMU has a key role to play in this, levelling the playing field for all tech firms across the UK.

The DMU’s mission is to promote greater competition and innovation in digital markets and protect consumers and businesses from unfair practices in the UK.

In the Microsoft-Activision Blizzard merger, the CMA has proven that it is prepared to go toe-to-toe with Big Tech when necessary, in the interests of both competition and consumers.

That it has potentially secured greater concessions from Microsoft than other, similar regulators bodes well for the DMU’s chances of holding tech giants to account.

However, it needs the right powers to get on with the job of promoting competition in digital markets and the government must ensure the legislation making its way through parliament isn’t watered down by Big Tech lobbying.