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Facebook Freeloads Off Newspapers. This Plan Might Stop It

What happened next, though, was telling: The Australian measure passed—and Google and Facebook did indeed pay up, remunerating Australian news companies for hundreds of millions of dollars. The news experiment Down Under has spurred legislatures worldwide to adopt a version of their own—an EU directive has Google forging similar agreements, most recently with France—momentum that advocates say is making Google and Facebook nervous.

“Google and Facebook don’t want to start a precedent where they have to pay for content,” says Mike Davis, director of the Internet Accountability Project, a conservative think tank that has joined liberals in Washington in pushing for antitrust reforms that would curtail Big Tech. “This is small potatoes for them—it’s a couple billion dollars, right? But it’s life or death for your hometown newspaper.”

The architects of the JCPA are motivated by a single, fiery accusation: Google and Facebook are “free-riding” off the news. It’s this free-riding, advocates contend, that perhaps more than any other factor has driven journalism into financial collapse.

In the decade or so after the Great Recession, the blame for newsrooms’ decline was attributed broadly to “the internet”—and like encyclopedias, traditional journalism was dinged for failing to adapt to technological change.

But by the end of the 2010s, a new argument had coalesced from media scholars and economists: Google and Facebook were the real culprits. Alongside an extensive white paper from the News Media Alliance, the influential antitrust thinker Matt Stoller might be where this school’s clearest explanation comes from. A confluence of factors, Stoller argues, disguised what was really causing journalism’s collapse.

The argument makes three basic points. First, news is extremely valuable to Google and Facebook: The snippets, links, and excerpts of news they display keep users engaged with a stream of novel content. In the social media factory that sells your engagement to advertisers, the news has become an essential “commodity input”—what timber is to home construction, or steel is to shipbuilding—to use the metaphor of Microsoft President Brad Smith, one of the biggest backers of the collective bargaining concept.

Second, unlike other types of content—such as music and video streaming, terrestrial radio stations, and movie theater chains where platforms pay creators for the economic value their creations provide—Google and Facebook don’t pay to host news. (They don’t have to, thanks to a pivotal copyright decision that ruled in Google’s favor way back in 2007.) “We would never expect a platform to stream movies without paying a film’s creators,” Representative David Cicilline, JCPA’s main sponsor in the House, said in August. Google and Facebook, he added, are “seizing news content to enrich their platforms but never paying for the labor and investment required to report the news.” (Disclosure: This past summer I interned on the House Antitrust Subcommittee, which is chaired by Cicilline.)

Third, JCPA’s proponents emphasize that news publishers are fundamentally adversarial competitors with Google and Facebook. Although the two tribes are deeply symbiotic (note the “Share” button alongside this article) they also, at bottom, compete for the same resource—your time—that they must sell to the same limited pool of advertisers. Throughout the 2010s, just as Google and Facebook were devouring a gargantuan share of the world’s advertising revenue, news publishers began watching their advertising revenues crumble.

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