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When: Thursday, May 4, 2023, 8:15 a.m. – 6:30 p.m. EDT 

Where: Renaissance Hotel, Washington, DC

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The News/Media Alliance is happy to be partnering with Economic Liberties on the Anti-Monopoly Summit. We invite our Alliance members to attend the Summit on May 4, 2023 at the Renaissance Hotel in Washington D.C. This Summit will bring together the growing anti-monopoly movement in a marquee one-day conference to build power and engage with senior policymakers from across the country.

Description:

The anti-monopoly movement has swelled in prominence in recent years. Historic appointments at the Federal Trade Commission, the Department of Justice Antitrust Division, and the White House, alongside bipartisan leadership in Congress and President Biden’s July 2021 Executive Order on Promoting Competition in the U.S. launched a successful all-of-government agenda to arrest corporate power.

For more information, visit antimonopolysummit.org.

Keynote speakers include:

• Amy Klobuchar, Senator for the State of Minnesota
• Lael Brainard, Director, National Economic Council
• Lina Khan, Chair, Federal Trade Commission
• Jonathan Kanter, Assistant Attorney General, Antitrust Division, Department of Justice
• Jennifer Abruzzo, General Counsel, National Labor Relations Board
• Summer Lee, Representative for the State of Pennsylvania
• Doha Mekki, Principal Deputy Assistant Attorney General, Antitrust Division, Department of Justice
• Elizabeth Wilkins, Chief of Staff to the Chair and Director, Office of Policy and Planning, Federal Trade Commission
• Patrick Spence, CEO of Sonos
• More speakers coming soon.

Organizations supporting the event include Common Future, Demand Progress, Digital Content Next, Future of Music Coalition, International Brotherhood of Teamsters, National Community Pharmacists Association, National Grocers Association, News/Media Alliance, Small Business Majority, Economic Security Project, Kauffman Foundation, Omidyar Network.

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FOR IMMEDIATE RELEASE

Arlington, VA – The News/Media Alliance today filed comments and an accompanying economic study with the Federal Trade Commission (FTC), urging the agency to ensure news and magazine publishers maintain the ability to benefit from digital advertising under any potential consumer privacy rules it may adopt. The comments were in response to the FTC’s Advanced Notice of Proposed Rulemaking (ANPR) on commercial surveillance and data security, published in August. The ANPR requested stakeholder feedback on whether the agency should implement new trade regulation rules on how companies use consumer data.

Highlighting the vital role high-quality journalism plays in supporting a healthy democracy and vibrant local economies – and the importance of digital advertising in supporting investments in journalism – the Alliance in its submission to the FTC recommends the adoption of a “Data Poaching Rule” that would prohibit dominant tech platforms from poaching first-party consumer data from publishers.

Today the dominant platforms use their market power to collect consumer data broadly throughout the internet – not just to provide a service in exchange for data – while also dictating the contractual terms of any services they provide, giving them broad usage rights to the data they poach. Third-party collection and selling of users’ data on websites owned by news and magazine publishers is not within a reasonable expectation of our readers. The platforms’ extensive tracking of consumers can eventually lead to an erosion of consumer trust and weaker competition in digital advertising markets. The Alliance’s proposed Data Poaching Rule would grant the sole right to collect consumer data to the known owner or operator of the digital property with whom the consumer interacts. Based on the Apple App Tracking changes over the last couple of years, it can be expected that around 10 percent of current revenue received by the platforms will shift to publishers, including news and magazine publishers, which will in turn result in increased quality journalism.

“Regulators must act now to address the monopolistic practices of the dominant platforms that suppress competition and threaten quality journalism in the digital ecosystem,” stated Alliance Executive Vice President & General Counsel Danielle Coffey. “Federal consumer privacy rules, if drafted properly, could help rebalance the playing field, with the Data Poaching Rule ensuring that those who produce original content and build long-lasting and trusting relationships with their users benefit the most from digital advertising on their websites.”

The comments also discuss the quid pro quo relationship between publishers and their readers – and publishers’ practice of clearly disclosing their data collection practices upfront and the benefit consumers receive from it – in addition to noting the benefits of targeted advertising, when conducted responsibly. The comments also call on the FTC to be mindful of existing data security and privacy compliance frameworks and to make sure any new rules would be consistent with those laws and regulations in order to lower compliance costs and provide consistency and predictability.

The comments further argue that any new rules should be weighed against the harm to the consumer, apportioned based on size and risk, and allow for companies to cure violations that have not resulted in “substantial privacy harm” under certain circumstances. Enforcement, meanwhile, should focus on instances of reckless or knowing violations.

The News/Media Alliance’s comments can be viewed in full here and the economic study – produced by Hal Singer and Augustus Urschel of Econ One – here.

###

Media Contact:
Lindsey Loving
Director, Communications
News/Media Alliance
lindsey@newsmediaalliance.org

The News/Media Alliance is a nonprofit organization representing more than 2,000 news and magazine media organizations and their multiplatform businesses in the United States and globally. Alliance members include print and digital publishers of original journalism. Headquartered just outside Washington, D.C., the association focuses on ensuring the future of journalism through communication, research, advocacy, and innovation. Information about the News/Media Alliance can be found at www.newsmediaalliance.org.

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In early June, the French competition authority, Autorité de la concurrence, announced that Google had reached an agreement with the authority to settle an antitrust investigation regarding the tech giant’s anticompetitive behavior in the market for online advertising services. In addition to a €220 million fine, the settlement includes commitments by Google to change the way their platforms operate to allow for a more competitive industry. While the practical effects of the changes Google has committed to making remain to be seen, the settlement is yet another important step forward in addressing Google’s anticompetitive practices internationally and in rebalancing the online marketplace to create a more even playing field for news publishers.

Following complaints filed by multiple news publishers in 2019, the investigation centered around two of Google’s main advertising services: Doubleclick for Publishers (DFP) and Doubleclick Ad Exchange (AdX). The French competition authority found that Google abused its dominant market position by engaging in practices in the operation of these two services that harmed publishers and made it more difficult for other advertising platforms to compete with Google. In particular, the investigation showed that when private entities tried to buy and sell online advertising space, the DFP publisher ad server favored Google’s own AdX while, conversely, AdX favored the DFP ad server.

In both instances, the investigation found that Google had applied less favorable terms and technical conditions to third-party platforms than to its own services. As an example of this self-preferencing, Google used the prices on competing supply side platforms (SSPs) to inform AdX, allowing it to better optimize AdX, among other benefits, and providing Google’s platforms a competitive leverage at the expense of a competitive marketplace. Google also imposed contractual limitations on third-party platforms to further push buyers and sellers to stay within the Google DFP and AdX ecosystems by making interoperability between Google and third-party platforms more difficult and less efficient. By making it harder and more expensive to use third-party SSPs, Google has been able to steer more and more business to their platforms and away from competitors, making it harder for publishers to use other platforms.

In addition to the fine, Google agreed to change their practices to increase interoperability with third-party platforms and to not restrict the ability of publishers using Ad Manager to negotiate prices and terms directly with third-party platforms, hopefully increasing the ease and ability of publishers and marketers to utilize third-party ad platforms that compete with Google. These changes may lead to a more balanced and healthy competition in the online display ad marketplace and limit Google’s market dominance in the field. Google also committed to no longer using other platforms’ pricing information to optimize their services and to give Ad Manager users at least three months’ notice of any changes that publishers need to adopt. The fees associated with using third-party ad platforms will also be removed according to the agreement, and Google has promised to publish a guide on how to configure AdX Direct Configuration for customers using a third-party platform.

The French settlement comes at a time when Google is facing increased antitrust scrutiny focused on its ad tech services globally, including in the United States, Australia, the United Kingdom, and the European Union. These cases similarly focus on the ways that Google’s advertising technology platforms have restricted competition in the digital ad sector. The commitments made by Google in the French case give reason to hope for a more competitive digital marketplace in France, in addition to potentially serving as a blueprint for regulators in other parts of the world.

Recently, in the United Kingdom, the Competition and Markets Authority (CMA) released proposed commitments made by Google with regards to their Privacy Sandbox initiative following the CMA’s investigation into the issue. The Privacy Sandbox is aimed at developing alternative tools for interest-based digital advertising once third-party cookies are phased out. The CMA’s investigation into the Privacy Sandbox before the tools are finalized is an encouraging development, hopefully addressing problematic issues and features before they arise. For publishers, the increased focus by national competition authorities on Google’s digital advertising practices is long overdue and will hopefully help create an online marketplace that works better for everyone and not just the few dominant platforms.

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In mid-March, Politico published a powerful piece of investigative reporting titled “How Washington fumbled the future,” detailing the Federal Trade Commission’s (FTC) 2012 investigation into Google’s anticompetitive conduct and the agency’s failure to bring a case against Google.

The report is both revealing and damning, exposing how clear the evidence against Google was already nearly ten years ago and how the FTC’s refusal to take action has allowed Google to further entrench its dominant position in the online ecosystem. By laying out the many ways in which Google stifles competition, the memos serve as further evidence of the unequal playing field between Google and news publishers.

The memos published by Politico include a 170-page analysis drafted by the FTC’s antitrust lawyers, a memo by two of the agency’s economists, as well as other documents addressing the claims made against Google by other companies ranging from competitors like Microsoft and Yahoo! to others who rely on Google, including Amazon, TripAdvisor and Yelp.

The FTC’s standard practice is to request two analyses of the case in any antitrust investigation, one by antitrust lawyers and one by economists, with the economists seen as the more conservative and cautious of the two. Here, although both groups made some clearly unfounded assumptions – including noting that behavioral advertising has only “limited potential for growth” – and the economists recommended not pursuing the case, the lawyers made a convincing argument and found Google’s behavior deeply troubling in many instances.

The lawyers’ memo focuses on four main complaints against Google: self-preferencing of Google’s own content in search results, scraping of vertical rivals’ content to improve Google’s own products, contractual restrictions regarding the use of AdWords, and exclusionary terms in syndicated search and search advertising service agreements.

While the documents do not discuss news publishers in particular, news organizations have long experienced first-hand the effects of many of the issues highlighted in the memos. Scraping of content is not limited to Yelp and TripAdvisor reviews; Google regularly scrapes news content to answer user queries in both search and audio, diverting readers from news sites. Similarly, publishers were effectively forced to adopt Google’s AMP format or risk their content being downgraded in mobile search results, leading to reduced visibility for high-quality news content.

With regards to Google’s exclusionary agreements for search and search advertising, the memos paint a picture of a company willing, at least in some cases, to indirectly force others to abandon any efforts to develop or do business with competing products and services. As one example, the lawyers’ memo discusses efforts by CityGrid – a property owned by IAC, which at the time owned more than 50 different websites, including Ask.com and Newsweek – to mix-and-match search advertising providers in addition to developing its own digital advertising platform. Not only did its efforts to use other providers alongside Google’s AdSense seem to have failed, with CityGrid eventually being “forced” to sign onto the IAC’s umbrella agreement with Google that did not allow it to use other networks, Google’s exclusivity provisions made developing a “niche competitive alternative” to AdSense difficult.

CityGrid’s experience exemplifies the challenges faced by publishers and others when dealing with Google. The combination of aggressive acquisitions and lax antitrust enforcement has allowed Google to achieve a dominating position where publishers are forced to use Google’s services in order to take part in the digital marketplace, while accepting terms that clearly disadvantage them at the benefit of Google. CityGrid’s difficulties establishing a competitive ad platform may present just the tip of the iceberg – it is possible that Google’s unfair terms, together with its market position, have dis-incentivized or even downright squashed the development of other ad platforms that would provide publishers with better terms and services than Google’s own offerings.

In 2012, Google was a much smaller company than it is today. In the intervening years, it has cemented its position as the dominant actor in the digital advertising ecosystem while news organizations across the world are struggling to survive in the face of dwindling subscription and advertising revenues. Its exponential growth has also made it harder to regulate, with Google using its position and influence globally to fight any efforts to regulate its activities or to demand payments to news publishers for the use of their content. One only needs to look at the campaigns against the European Copyright Directive and the Australian media bargaining code for evidence of these strategies.

These global news compensation efforts are now trying to patch the damage caused by Google’s unregulated expansion and dominance over the last decade. In addition to Australia and Europe, Canada is reportedly considering adopting an Australia-style bargaining code while U.S. Congress is debating a safe harbor bill that would help level the playing field by allowing news publishers to collectively negotiate with the online platforms. At the same time, regulators in the United States and abroad have brought multiple antitrust suits against Google for anticompetitive conduct in search and advertising.

These legislative solutions and enforcement actions are not easy to develop or adopt, especially taking into account Google’s market power, and will not fix the problem completely, but they are the only way to protect a competitive digital marketplace and ensure a future for high-quality journalism. The online economy is at a critical juncture and it is vital we do not repeat the mistakes made by the FTC almost ten years ago.

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