The Australian Competition and Consumer Commission’s third Digital Services report has called for greater powers to combat Google’s dominance in search engines in Australia.
Releasing ACCC’s Digital platform services inquiry Interim report No. 3 – Search defaults and choice screens the Commission found Google’s dominance entrenched by the billions of dollars it paid to be the default search engine on Apple’s iPhones.
ACCC Chair Rod Sims said the company’s dominance was also extended and entrenched by its ownership of Chrome and by the default arrangements in place with competing browser suppliers and device manufacturers that used Google’s Android operating system.
“Google continues to be the dominant search engine in Australia, with a market share of 94 per cent,” Mr Sims said.
“Google Search is the default search engine on the two most popular browsers in Australia, Google’s Chrome browser and Apple’s Safari browser, which are pre-installed on most mobile devices in Australia,” he said.
“Google pays billions of dollars each year for these placements, which illustrates how being the default search engine is extremely valuable to Google’s business model.”
Mr Sims said Google’s vertical integration and costly commercial arrangements significantly increased barriers to entry and prevented new or emerging rival search engines from reaching consumers.
“This is likely to have stifled innovation and reduced consumer choice,” he said.
“It means that consumers may not be exposed to or aware of other options, such as search engines that protect users’ privacy and/or have an ecological focus, which limits the ability of these businesses to grow.”
Mr Sims said a competitive search engine market could benefit consumers through innovation in search results or display; a reduction in sponsored advertising results; and incentives to attract users such as rewards or better data protection.
He said the ACCC recommended that it be given the power to develop and implement a mandatory search engine choice screen and to develop additional measures to improve competition and consumer choice in search engines.
“A choice screen presents consumers with a selection of search engines, rather than having a default search engine set for them.”
“Choice screens can also help reduce barriers to expansion for competitors to Google, who may offer consumers more options for alternative search engines around issues like privacy and how personal data is collected and used,” Mr Sims said.
The ACCC’s 130-page Report can be accessed at this PS News link.
