In the global campaign to crack down on the power of Big Tech, few regulators have swashbuckled with as much swagger as those in the U.K.
But two pronouncements Tuesday show the Brits have their limits, delivering a dash of hope to tech giants fearful of dramatic overseas intervention.
The first announcement came courtesy of the U.K.’s new digital secretary, Michelle Donelan, who said she had removed language forcing large tech companies to moderate “legal but harmful” content from a sweeping online safety bill under consideration.
The second statement arrived a few hours later from the U.K.’s top antitrust regulatory body, the Competition and Markets Authority, or CMA, which found no need for major government intervention in the highly concentrated music streaming industry.
The pair of proclamations mark rare moments of restraint by U.K. officials, who have moved aggressively in recent years to curtail the growing might of American tech giants.
In the past 12 months alone, U.K. officials have conducted investigations into several high-profile mergers, including the proposed Microsoft–Activision Blizzard acquisition and Nvidia’s since-abandoned plan to purchase Arm; started probes of potential market dominance by Apple, Amazon, and Google; ordered the unraveling of Meta’s acquisition of Giphy, despite minimal pushback from other foreign regulatory bodies; and introduced long-awaited online safety legislation aimed at increasing content moderation by tech platforms.
Tuesday’s developments, however, display some measure of moderation by U.K. regulators and policymakers.
In both cases, U.K. officials reached well-reasoned judgments about their areas of concern.
With regard to the “legal but harmful” provision, Donelan fairly concluded that the requirement would chill free speech and place vague, hard-to-enforce mandates on tech companies. In addition, the decision removes the “threat that tech firms or future governments could use the laws as a license to censor legitimate views,” Donelan said.
“I promised I would make some commonsense tweaks, and I have,” Donelan tweeted. “This is a stronger, better bill for it. It is focused where it needs to be: on protecting children and on stamping out illegality online.”
On the music streaming front, U.K. regulators concluded after a nearly yearlong market study that the industry remains sufficiently competitive—even though Spotify, Amazon, and Apple account for roughly 90% of the monthly active users on streaming platforms in the U.K. (The study excluded views of music videos through YouTube.)
In reaching their verdict, CMA officials noted that consumers have access to vast libraries of music and pay less for streaming than they did in the late 2000s. At the same time, U.K. officials found average royalty rates for artists and songwriters have increased over the past decade. To top it off, regulators said they have “not found evidence of substantial and sustained excess profits” by major record labels.
“We have found that it is unlikely that the outcomes that concern many stakeholders are primarily driven by competition,” CMA officials wrote. “Consequently, it is unlikely that a competition intervention would improve outcomes overall, and release more money in the system to pay creators more.”
The two decisions likely don’t signal a sea change within the U.K.’s hall of regulatory power.
British policymakers are still pursuing aggressive new rules for policing online content, some of which go well beyond those established by U.S. officials. As part of the updated language proposed by Donelan, tech companies would still need to give users options for avoiding harmful online content and work to shield children from such content.
In addition, leniency shown to low-margin music streamers likely won’t spill over to Apple and Google, currently under U.K. scrutiny for their massively profitable mobile operating system duopoly, or Amazon, which stands accused of bullying third-party merchants in its e-commerce platform. CMA approval of Microsoft’s $68.7 billion purchase of video game developer Activision Blizzard is hardly a slam dunk, either.
At least for this week, though, U.K. officials employed some discipline in their blitz on Big Tech.
Want to send thoughts or suggestions to Data Sheet? Drop me a line here.
Jacob Carpenter
