Big Tech, media outlets spar over news circulation

Big Tech, media outlets spar over news circulation

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Technology majors like Google, Facebook have faced news publishers’ wrath for allegedly taking a lion’s share of digital advertising revenue. This even prompted Australia to draft rules in August asking these firms to pay for news published on their platforms. Mint explores.

What are the reasons for publishers’ agony?

The primary tussle is about who controls news distribution. By becoming the primary source for news on the internet, the likes of Google, Facebook and Twitter have become publishers in their own right, without an editorial oversight. These firms also make money from digital advertising, which is fast becoming the main source of revenue for publishers too. The Australian government, in August, drafted regulations that would force tech firms to pay news publishers for displaying their content—a move that faced strong resistance. In fact, Facebook even threatened to remove news from its platform in Australia.

Should Big Tech pay news publishers?

While the matter sounds simple, it may actually have multiple layers to it. One could argue that news publishers depend on search engines and social media to get traffic, which means they are using the service Big Tech provides, and hence should pay for that service. In the current scheme of things, they pay for it by sharing a major part of ad revenues with these companies. However, the traffic to news publishers from these platforms is determined by the algorithms, which means they are the ones who should be paying for using the content provided by publishers—since they don’t create content in the first place.

Consumption shift

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Consumption shift

How have the news outlets responded to these cases?

Many publishers worldwide have tried to switch to subscription and paid news models to get around Big Tech. However, this hasn’t worked for most since Google, Facebook and Apple serve as the gateway to the internet. In India, some lawyers say this is reason enough for the Competition Commission of India (CCI) to intervene and regulate how gatekeepers must act.

What have tech majors done to resolve issues?

Google, Facebook and Apple have taken a few steps on their part to assuage publishers’ concerns. On 1 October, Google announced a billion-dollar initiative to license news from publishers for a new product called Google News Showcase. Facebook had started a similar initiative last year, offering to pay news publishers to license their content for a curated section of the app meant for news. Apple, on the other hand, has proposed giving 50% of revenues to publishers for its Apple News Plus subscription service.

Who holds the reins to tackle this in India?

Some say that for the CCI to be involved in India, one would have to prove that Big Tech operates in the same market as news publishers. Alternatively, the Competition Act could be invoked if Big Tech behaviour is found to be predatory toward news publishers. Some lawyers also say that the Central Consumer Protection Authority, formed in 2019, could also look into this if one can prove that Big Tech’s power over the internet affects the consumer with respect to news.

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