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The dynamic nature of digital advertising markets and the types of concerns identified by the Competition and Markets Authority (CMA) in its market study are such that existing laws are not suitable for effective regulation. It is therefore recommending a new pro-competition regulatory regime to govern the behaviour of major platforms funded by digital advertising, like Google and Facebook.

This recommendation to government is the result of a year-long examination of the markets. The CMA used its statutory information gathering powers to lift the lid on how advertising revenue drives the business model of major platforms.

UK expenditure on digital advertising was around 14bn in 2019, equivalent to about 500 per household. About 80% of this is earned by just 2 companies: Google and Facebook. Google enjoys a more than 90% share of the 7.3 billion search advertising market in the UK, while Facebook has a share of over 50% of the 5.5 billion display advertising market. Googles revenue per search has more than doubled since 2011, while Facebooks average revenue per user has increased from less than 5 in 2011 to over 50 in 2019.

The services provided by Facebook and Google are highly valued by consumers and help many small businesses to reach new customers. While both originally grew by offering better services than the main platforms in the market at the time, the CMA is concerned that they have developed such unassailable market positions that rivals can no longer compete on equal terms:

Their large user base is a source of market power it means that Facebook is a must-have network for users to remain in contact with each other, and enables Google to train its search algorithms in ways that other search engines cannot.

Each has unmatchable access to user data, allowing them to target advertisements to individual consumers and tailor the services they provide.

Both use default settings to nudge people into using their services and giving up their data for example Google paid around 1.2bn in 2019 to be the default search provider on mobile devices and browsers in the UK, while Facebook requires people to accept personalised advertising as a condition for using their service.

Their presence across many different markets, partially acquired through many acquisitions over the years, also makes it harder for rivals to compete.

Each of these factors individually presents a potential barrier to new competition, but together they work to reinforce each other and are extremely difficult to overcome.

These issues matter to consumers. Weak competition in search and social media leads to reduced innovation and choice, as well as to consumers giving up more data than they would like. Further, if the 14bn spend in the UK last year on digital advertising is higher than it would be in a more competitive market, this will be felt in the prices for hotels, flights, consumer electronics, books, insurance and many other products that make heavy use of digital advertising. The CMA found that Googles prices are around 30% to 40% higher than Bing when comparing like-for-like search terms on desktop and mobile.

Google and Facebooks market positions also have a profound impact on newspapers and other publishers. The CMA has found that newspapers are reliant on Google and Facebook for almost 40% of all visits to their sites. This dependency potentially squeezes their share of digital advertising revenues, undermining their ability to produce valuable content.

The scale and nature of these issues mean that a new pro-competition regulatory regime is needed so that users can continue to benefit from innovative new services; rival businesses can compete on a level playing field and publishers do not find their revenues unduly squeezed. The CMAs proposals are consistent with those made by Professor Jason Furman in his report for the government.

The CMA has proposed that within the new regime a Digital Markets Unit should have the ability to:

enforce a code of conduct to ensure that platforms with a position of market power, like Google and Facebook, do not engage in exploitative or exclusionary practices, or practices likely to reduce trust and transparency, and to impose fines if necessary.

order Google to open up its click and query data to rival search engines to allow them to improve their algorithms so they can properly compete. This would be designed in a way that does not involve the transfer of personal data to avoid privacy concerns.

order Facebook to increase its interoperability with competing social media platforms. Platforms would need to secure consumer consent for the use of any of their data.

restrict Googles ability to secure its place as the default search engine on mobile devices and browsers in order to introduce more choice for users.

order Facebook to give consumers a choice over whether to receive personalised advertising.

introduce a fairness-by-design duty on the platforms to ensure that they are making it as easy as possible for users to make meaningful choices.

order the separation of platforms where necessary to ensure healthy competition.

Whilst this recommendation is UK-focused, many of the problems that the CMA has identified are international in nature. It will therefore continue to take a leading role globally in relation to these issues as part of the CMAs wider digital strategy.

CMA Chief Executive Andrea Coscelli said:

Through our examination of this market, we have discovered how major online platforms like Google and Facebook operate and how they use digital advertising to fuel their business models. What we have found is concerning if the market power of these firms goes unchecked, people and businesses will lose out. People will carry on handing over more of their personal data than necessary, a lack of competition could mean higher prices for goods and services bought online and we could all miss out on the benefits of the next innovative digital platform.

Our clear recommendation to government is that a new pro-competitive regulatory regime be established to address the concerns we have identified and regulate a sector which is central to all our lives.

Safeguarding peoples control over their data is paramount to privacy as well as to the healthy operation of the market, so the CMA has worked with the Information Commissioners Office (ICO) to examine the impact of privacy regulation on the market.

The General Data Protection Regulation is still in its early stages and the CMA is concerned that big platforms could be interpreting it in a way which favours their business models, instead of in a way which gives users control of their data. For example, big platforms might share user data freely across their own sizeable business ecosystem, while at the same time refusing to share data with reputable third parties which could have a detrimental impact on smaller players. The CMAs market study advocates a competitive-neutral approach to implementing privacy regulation, so that the big platforms are not able to exploit privacy regulation to their advantage. It will be working with the ICO and Ofcom further to address these issues through the Digital Regulation Cooperation Forum, the details of which were also published today.

The CMA, working with the ICO and Ofcom, is today formally launching a Digital Markets Taskforce. The Taskforce, originally commissioned by the government, will build on the conclusions of the market study, as well as looking more widely across all platforms to consider the functions, processes and powers which may be needed to promote competition. It will advise government on how a new regulatory regime for digital markets should be designed. To inform its work, the CMA is publishing a call for information, and writing to a number of platforms, seeking views and information. The Taskforce will deliver advice to government by the end of 2020.

The final report can be found in full on the online platforms and digital advertising market study webpage

The CMA is the UKs primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law.

In March the CMA was asked by government to lead a Digital Markets Taskforce, comprising CMA, Ofcom and the Information Commissioners Office to advise government on how a new pro-competition approach should be designed for digital markets. Find out more in the Terms of Reference for this work.

As a result of its clear recommendation for a new regulatory regime, and the ongoing work of the Taskforce, the CMA is not currently recommending making a market investigation reference. However, after the work of the Taskforce has concluded, it will assess whether the actions being taken by the government are sufficient to address the full range of issues identified by its market study, or whether direct action by the CMA is likely to be required.

Media queries should be directed to:press@cma.gov.ukor 020 3738 6460.

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New regime needed to take on tech giants - GOV.UK

What were they thinking is the question most of us ask when we consider our ugly history of slavery and those who supported the cause.

Seeing statues of Confederate leaders razed before our eyes leads us to imagine how people of that time period could have justified such a barbaric and cruel enterprise. Theres no excuse or rationalization that can be offered to normalize enslaving another human being. It doesnt matter what time period our ancestors lived in, they were simply wrong for allowing the practice to continue as long as it did.

As we know, slaveholders werent just limited to the South. And as weve seen time and time again, racism isnt confined to one region of our country. There were always those who knew slavery was wrong, and some spoke out against it while others waited until a civl war was waged before truly taking a side. It was easy to justify slavery for some during the early 19th Century, just as systematic racism has been simple for those of us who have benefited from it to overlook because thats just how things are.

Were coming to grips with our reality, and we should always question our ways of thinking. Life evolves and so should we.

But as we castigate our ancestors and tear down statues, its important that we also hold ourselves accountable. Recent protests have brought to the forefront issues of police brutality and racism against black people, and hopefully well see meaningful change as a result of this movement. However, as we consider how history will view us in 150 years, we may realize that this is just the tip of the spear.

For example, think about how weve dealt with immigration, particularly over the past decade. Multiple presidential administrations have not seen a problem with locking kids in cages or having families torn apart in the name of fighting illegal immigration. Decades from now, especially with the Latino population projected to grow substantially in the coming years, how will our treatment of immigrants, both legal and illegal, be viewed?

Before you answer, remember that legality isnt ultimately a barometer of right and wrong. Slavery was legal in our country at one point in time. Until the Suffrage Movement, it was illegal for women to vote. Segregation was also within the rights of business owners during a time in our not so distant history.

Certainly rights for LGBTQ citizens have come a long way just in the last decade. From gay marriage to the Supreme Courts recent decision banning discrimination against LGBTQ employees in the workplace, several key victories have been won in the fight for equality.

But Im still young enough to remember when homophobic slurs were thrown around loosely and not just as locker room talk.

Many religions still stand in opposition to homosexuality. How will they be remembered in 150 years?

Who knows what the future might bring? Do you really believe in 2170, well still be eating meat raised from livestock?

Eating meat is so engrained in our society that we overlook obvious animal abuse. We dont view what we eat as being real, but share a link to a story about a dog market from China on your Facebook page and see how many angry emojis you get as a response.

In 150 years, its likely any meat we eat will have been created in a lab. Might we be viewed as animal abusers because of our current diets and our reluctance to view factory farming as inhumane?

Heres another topic thats always causing a stir and one honestly that comes down to opinion. How will abortion be viewed in the years to come? Will pro-choice be the norm, or will the practice ultimately be banned?

Many advocates believe abortion is a womans choice. If that standpoint ultimately withstands the test of time, will pro-life supporters be viewed as misogynistic and controlling?

What if abortion is ultimately banned? Will history label those who supported it as murderers?

How about guns? As thousands of people die to gunfire each year in our country, how will the topic be broached long after weve been laid to rest?

What about our culture? Will academics centuries from now judge us as being a little dense because we argue all day over societal problems while our movies glorify violence and our music praises womanizing?

Winston Churchill was famously quoted as saying History will be kind to me, for I intend to write it.

Churchill probably never would have guessed that in 2020, the words Was a Racist would be scrawled on his statue in Parliament Square.

The point is, whats accepted now may seem odd, if not downright evil, in the future.

The protests are causing many to argue over whether or not a group of people has the right to block a street, or if we need police, or if a statue should be torn down. What they should be teaching us is that we should always be cognizant of our decisions, that we should take part in our government and be active in the community, and that it might not hurt to envision how our lifestyles and beliefs may be viewed long after were gone.

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SUDDEATH COLUMN: How will history treat us? | Opinion - Evening News and Tribune

MEXICO CITY (Reuters) - Mexican President Andres Manuel Lopez Obrador will hold bilateral talks with U.S. counterpart Donald Trump on July 8 in Washington, where he will underline his commitment to trade and investment, Mexicos foreign minister said on Wednesday.

FILE PHOTO: Mexico's President Andres Manuel Lopez Obrador speaks during a news conference at the National Palace in Mexico City, Mexico June 29, 2020. Mexico's Presidency/Handout via REUTERS

The leftist Lopez Obrador has not left his country since taking office in December 2018, and paying his first foreign visit to Trump is politically risky because the Republican U.S. president is widely disliked in Mexico.

TheMexican president has described the planned visit, which is intended to celebrate the start of a new North American trade deal on July 1, as a matter of economic necessity.

Mexican Foreign Minister Marcelo Ebrard said Lopez Obrador would hold bilateral talks with Trump on the afternoon of July 8. Trilateral matters that include Canada will be on the agenda on the morning of July 9, he added.

Mexico wanted to stress its commitment to trade, investment and social welfare at the Washington summit, Ebrard told a news conference, standing alongside Lopez Obrador.

Trump said in a statement he looked forward to welcoming Lopez Obrador to the White House for talks on trade, health and security issues, as they marked the July 1 start of the United States-Mexico-Canada Agreement (USMCA). The USMCA is replacing the 26-year-old North American Free Trade Agreement (NAFTA).

Mexico has urged Canadian Prime Minister Justin Trudeau to take part in the meeting, and Ebrard said he expected Canadas government to detail its plans soon.

So far, Canada had not responded to the invitation to participate in Washington, Lopez Obrador said.

Many Mexicans have held Trump in low regard since he described Mexican migrants as rapists and drug runners in his 2015-16 election campaign and vowed to make Mexico pay for his planned border wall.

He has also made repeated threats against Mexicos economy to pressure its government to stem illegal immigration.

Reporting by Dave Graham and Anthony Esposito in Mexico City; Additional reporting by Eric Beech in Washington; Editing by Bernadette Baum and Jonathan Oatis

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Mexican president to hold first meeting with Trump on July 8 - Reuters

US President Donald Trumps decision to suspend work visas and pause issuance of green cards hits one country the hardest -- India. His executive order is temporary, but that wont shorten the chain of disappointment, or mitigate suffering of thousands of families.

Last weeks proclamation suspended H-1B (high-skilled workers), H-4 (spouses of H-1Bs), L-1 (intra-company transfers) visas, among others, until the end of 2020. The stated reason: the US economy and high unemployment. Unstated reason: shoring up Trumps base and tapping potential voters who have turned fearful of immigration because of the coronavirus pandemic.

There are two sides to the order: an obvious political one, and a potentially deeper regulatory problem, which could negatively impact hundreds of thousands of Indians awaiting green cards.

The executive order is red meat to Trumps base and completes the circle of his initial, Buy American, Hire American edict. Fear is easy to exploit in any political season, but its easier with an economy in dire straits and a second wave of coronavirus hitting the country.

Donald Trumps poll numbers are bad, and he seems nervous about re-election, going by his Twitter meter. He let anti-immigration hawkish advisor Stephen Miller loose to do what scores of US business leaders opposed. Apple, Google, Microsoft, Amazon et al have criticised the suspension of H-1B visas, saying it would hurt the US economy and lead to more off-shoring. Canada is already a beneficiary.

But the #AmericaFirst crowd is happy, and sees the decision as a much-needed correction. Critics have long claimed the H-1B progamme is nothing but a vehicle for cheap labour to be exploited by large corporations. In reality, H-1B visas have become increasingly burdensome.

So, whats the real impact of Trumps latest disruption? First, US embassies and consulates stopped processing visas on March 20 because of the coronavirus pandemic. Its unclear when those services will resume, and uncertainty adds to the misery of those caught in the middle.

Second, Trumps order affects future applicants, not existing ones. Trump clearly split the difference between Millers extremism and other advisors moderation. But if the economy doesnt improve and the suspension continues, things will get tougher.

Third, US companies have cut back on projected budgets as they try to stabilise in this virus-hit environment where safety regulations and social distancing make hiring more difficult.

Fourth, Indian IT companies have already adjusted their business models -- they are less reliant on H-1B visas. The story has changed over time given the constant attacks, bad press, rising visa fees, and the growing jungle of paperwork required for H-1Bs.

Indian IT majors have steadily increased local hiring with as much as 70% of the work force coming from within the US. Infosys, TCS, Wipro and Tech Mahindra have thousands of Americans working for them. That cant be news to Miller or the anti-H-1B lobby. But facts rarely interfere in an ideological battle.

Its true that most of the H-1B visa holders are Indian, and the vast majority are employed by US tech titans, not Indian companies. In 2019, of the 388,403 H-1Bs, 72% were from India. China is in second place at 13%. The story is the same for green cards.

This is where the regulations to enforce Trumps order could be the devil of the detail. The new regulatory framework is expected soon but no one knows when. If existing rules are changed, more than 350,000 Indian professionals on H-1Bs awaiting green cards could become vulnerable.

The Indian line is long, because the US issues 140,000 employment-based green cards annually, and the 7% per country limit has swelled Indian numbers over the years. They are perfectly legal as of now. But Miller and his ideological friends in various agencies could demand new labour certification through new regulations. That would prompt legal challenges taking the fight to the courts.

The US Congress could help by lifting the 7% cap on green cards. But a powerful Democrat -- Senator Dick Durbin -- has effectively blocked recent bipartisan efforts to do precisely that.

Everyone agrees Americas immigration is broken. Attempts at comprehensive reform have failed over the years because Democrats and Republicans cant agree on a fix. Tinkering and piecemeal solutions have given temporary relief. But thats about it.

Now the two parties are so far apart, a bipartisan solution seems distant. The Democrats essentially see immigration as a human right and want any deal to include a pathway to citizenship for illegal immigrants. The Republicans want no such amnesty, only the best and the brightest. Trump knows Americas mood has changed on immigration. He has been busy erecting walls.

Originally posted here:
View: Trump's H-1B visa suspension may have more to it than meets the eye - Economic Times

WASHINGTON, DC - JUNE 30: U.S. Sen. Rand Paul (R-KY) poses a question to witnesses at a hearing of ... [+] the Senate Health, Education, Labor and Pensions Committee on June 30, 2020 in Washington, DC. The committee is examining efforts to contain the Covid-19 pandemic while putting people back to work and kids back in school. (Photo by Kevin Dietsch-Pool/Getty Images)

The Internet is having a bit of fun with Rand Pauls claim during a Tuesday Senate committee hearing that We shouldnt presume that a group of experts somehow knows whats best (heres Tommy Beer with more). After all, theyre the experts. Shouldnt we get out of the way and do as the experts tell us?

No. Rand Paul is right.

Friedrich Hayek was famously skeptical of experts because they have a tendency to stretch beyond their expertise and make claims, recommendations, or policies that are beyond the narrow confines of their expertise. They also tend to collapse social problems into frameworks and models that seem easy to manipulate but that leave out a lot of important on-the-ground knowledge that, Hayek argued, is of a kind that is inaccessible to an outside observer. In short, it is easy to mistake a model for the actual underlying reality. It is just as easy to identify important considerations and act as if they are the only

In a 2014 book, William Easterly highlighted and criticized The Tyranny of Experts (I reviewed it for Regulation here). His subtitle is revealing and relevant to the present moment: Economists, Dictators, and the Forgotten Rights of the Poor. Experts can identify facts and make recommendations, certainly, but theyre not well-positioned to know the specific trade-offs and decisions people should make in light of what they know.

Probably the best illustration of this that I've seen is not a dense academic treatise but the February 6, 2013 installment of the webcomic Saturday Morning Breakfast Cereal. A gentleman in a coat and tie stands in front of a tank of fluid in which someone is floating like Luke Skywalker in the bacta tank in The Empire Strikes Back. He says Weve encased everyone in a vat of gelatin, with nutrition fed directly into their mouths. Once a day, the gelatin is electrically excited so as to stimulate their bodies to aerobic exercise! They all live to at least 150.

The cartoons caption says fortunately, public health advocates have no legislative power.

Thats the important point relevant to Rand Pauls statement on Tuesday. In the cartoon, the experts have created and are enthusiastic about a technology that will lead to long lives. However, I think most of us would agree that floating in a tank of gelatineven if youre hooked up to Robert Nozicks experience machineisnt really living.

Paul makes the important point that a bit of humility is in order. An expert is very well-positioned to say if you do these things, then you can expect the following effects with the following probabilities. Only in the most extraordinary of circumstancesand even then, I'm still extremely skepticalshould they presume to tell others exactly which choices they should make.

On this, I think this passage from Adam Smiths Wealth of Nations is relevant. Ill let him have the last word:

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it.

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Rand Paul Is Right About Experts - Forbes