From Australia to Maryland, the free press is waging a battle for survival against Facebook and Google. Besides being gushing firehoses of disinformation and conspiracies, another of Google and Facebook’s dangerous byproducts is undermining the financial stability of media outlets all over the world. Where is the Biden administration in this fight?
These two companies alone suck up an astounding 60% of all global online advertising outside China. With Amazon taking another 9%, that leaves a mere 30% of global online ad revenue to be split among thousands of media outlets. That has resulted in underfunded and struggling news industries in the U.S. and other countries.
Australia’s competition commission found that for every $100 spent by advertisers on online advertising, $47 goes to Google and $24 to Facebook. Various studies have found the majority of people who access their news online don’t go to the original news source; instead, they access it via Facebook’s and Google’s platforms, absorbing the gist of the news from the platforms’ headlines and preview blurbs rather than reading full articles.
Consequently, Facebook and Google receive the lion’s share of the revenue from ads shown to news viewers rather than the original news sources. So Australia decided to fight this duopoly with some new rules. A new law will require large digital media companies to compensate Australian news companies for repackaging and monetizing their news content.
Google negotiated compensation deals with Australian news publishers, but Facebook flexed its muscles by cutting off Australians entirely from viewing or sharing news on its platform. Even government agencies like health, fire, and crisis services were banned. Facebook censored Australians more effectively than the Chinese government, prompting charges of “Big Tech authoritarianism.”
Facebook finally relented to Australia’s requirement in return for some vague concessions. But now a similar battle has erupted in Maryland.
In the last 10 years, U.S. newspapers’ advertising revenue declined by 62% and, with less revenue, newsroom employment dropped by nearly half. Squeezed by these economics, Maryland recently approved the country’s first tax on digital ad revenue, targeting companies like Facebook, Google and Amazon. The measure is expected to generate as much as $250 million in its first year, revenue the law dedicates to schools.
The tech giants are threatening lawsuits even as Connecticut and Indiana legislators have introduced similar measures.
This battle has only begun. One of the most important, unsettled debates of the internet age is whether digital media platforms like Facebook, Google, YouTube and Twitter are the new “public square,” or just the latest iteration of publishers and broadcasters, which are treated differently by the law.
Following the U.S. Capitol riot, the companies in question all decided to discontinue “publishing” the president of the United States. Before that, as the platforms tried to deal with their spray of disinformation regarding the pandemic and racial tensions, they added warning labels and removed the inflammatory content of certain users.
This makes it clear that Big Tech platforms regularly use their power to decide what content and sources they want to amplify. These companies have more in common with the New York Times, Fox News and Wall Street Journal than they do with online message boards or the free speech corner in London’s Hyde Park. They are quasi-publishers in which algorithms often perform the duties of a traditional news editor.
Critics of the Maryland/Australian approach claim that traditional media outlets already benefit when social platforms send user traffic back to the outlets’ websites. But that claim is easily debunked because ad revenue at news outlets has plummeted in the modern era, with one study finding that digital media traffic supplied less than 0.2% of total revenue to the news companies.
Copyright principles were established years before the internet was even invented, and they mandate that any individual person or organization cannot swipe someone else’s content and monetize it without paying for it.
Yet the digital media platforms have been doing just that, turning thousands of publishers and broadcasters into mere ghostwriters of platform content. In other industries, appropriating product from the original producer without paying for it is called theft.
Democracies must stop Big Tech media, or they will keep undermining democracy. Canada says it will soon adopt the Australian approach. Will the United States, a longtime champion of the free press, also step up?