There has been widespread concern that social media platforms create "echo chambers", where a user's views are picked up by an algorithm and the news they are shown caters only to this outlook.
“This may create a ‘filter bubble’ effect where users may find themselves receiving less exposure to new information or conflicting viewpoints,” the paper says.
“A counterargument, however, is that digital platforms have improved accessibility to online content and have broadened rather than narrowed the diversity of news and comment available to consumers.”
While the issues paper specifically refers to Facebook and Google multiple times, it also references smaller search engines DuckDuckGo, Bing, Yahoo, Ask.com and Baidu.
Social media platforms Twitter, LinkedIn, Snapchat, Instagram, Pinterest and Google+ are also mentioned.
Fake news, where misinformation is rapidly spread online within these echo chambers, has made headlines in the past few years. It was not specifically referenced in the issues paper.
The attractiveness of digital platforms to advertisers and their use of “big data” would be a large part of the focus, ACCC chairman Rod Sims said.
“Digital platforms like Google and Facebook are part of the sweeping technological and cultural changes overhauling the media landscape in Australia and globally,” Mr Sims said.
“While these technological changes have brought many benefits for consumers, this inquiry will have a particular focus on examining whether the changes affect the quality and range of news supplied to Australian consumers.”
The inquiry will also consider the longer-term impacts on traditional media and whether they will remain financially viable.
The issues paper specifically references “partnerships” being entered into between some traditional media companies and digital platforms.
This includes a Fairfax Media and Google agreement, announced in December, to streamline digital advertising and help develop digital products.
Fairfax Media is the owner of The Age and The Sydney Morning Herald.
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