TMT Article

TMT News | Digital Comms Regulation

Posted: 28 Sep 2022

It has been a notable month for the announcement of potential future regulatory approaches for the UK digital communications market, particularly for the use of algorithms and cloud services. Given the backlash faced by Big Tech and indeed new AI tech on various issues of late, one could have expected that these regulatory initiatives had the potential to be robust in tone. In fact, they were suitably co-operative – termed as exploring and examining in a collaborative, open and transparent way with interested parties and industry players – no doubt to reflect that these are establishing and nascent markets in play, whilst still promoting competition and fairness.

Digital Regulation Co-operation Forum (DRCF) Response on algorithmic processing

Anyone who watched the recent BBC drama “The Capture” will have seen the imagined real-life impact of deep-fakery videos and imagery, as the featured UK Government Minister found himself being reimagined in live-streamed news casts through the use of AI algorithms to create an alternative “him”. This is just one example of the use and misuse of algorithms in processing data. Regulatory oversight is surely a “no-brainer,” but will this hamper innovation?

Perhaps timely that the DRCF followed up on its April papers on the risks and merits of algorithmic processing and exploring the possibility of creating a common regulatory standard for auditing algorithmic processing systems with a summary of industry responses on the suggested way forward.

Interestingly, the DCFR’s definition of “algorithmic processing” is wider than just AI apps powered by machine learning which may rely on algorithms to produce an output in the form of video or text content - it captures the processing of personal and non-personal data by any automated system. Real life examples of the outputs of these automated systems range from estimating age and recommending content, to making customer-based predictions and detecting fraudulent activity. But the context in which these systems are used will also be important in assessing transparency, fairness and any risk of discrimination – consider for example: how is data collected and stored? what level of human interaction is there? what is the output - content or informing decision-making?

It will be vital then that regulators have suitably skilled personnel to debate these issues with industry - whether a co-regulatory (regulators set and industry follows) or self-regulatory approach (industry sets and follows) is ultimately adopted - as well as the continued application of regulatory sandboxes to encourage growth and innovation of algorithmic-based services.

Ofcom’s probe into the UK cloud market and personal comms AV apps/devices

Ofcom’s proposed market study into cloud services is also timely – with the three hyperscalers (AWS, Microsoft and Google) firmly in its sights as collectively generating around 81% of revenues in the UK public cloud market. Staggering statistics, but not entirely unexpected given the speed at which cloud has become integrated into corporate IT programmes as a need-to-have. Ofcom’s plan to consult and publish a final report within twelve months is entirely necessary in a fast-moving innovating market.

In parallel, Ofcom’s broader work programme shows clear focus on other booming digital comms markets – with its intention to look into online personal comms apps and devices for audiovisual (AV) content (e.g. Whats App, Zoom), as well as personal assistant AV gateways (e.g. Smart speakers, connected TVs). Particular focus will be on interoperability and potential bottleneck concerns – with Ofcom probing any limitations on the ability of these apps and devices to interact with each other.

Post-pandemic, we are all only too aware of the relevance and role of these services and devices in our everyday lives and so it is right that Ofcom examines the strength of competition in these markets and the market positions of the largest providers.

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