Like most industries, news media outlets have made business decisions impacting revenue and the business landscape. Not all of those decisions have paid off.  One such decision was made almost twenty years ago to allow news content to be used on search and social platforms when the value exchange was fair, and traffic produced revenue through advertising. However, today, that value exchange is nearly nonexistent. It has been reported that 65 percent of users stay within the walled gardens and do not click through. And when few do click through, the ad tech tax is imposed, where the platforms take up to 70 percent of every digital advertising dollar because they also dominate the ad tech ecosystem, which feeds off the data collected inside their products and across the web. There is no longer a fair exchange of value, and no one publisher alone can alter this dynamic.

The White Paper outlines several ways in which Google uses news content to its advantage – and to news publishers’ detriment – across its products and services:

• The use of news content through AMP (Accelerated Mobile Pages), Google Discover, Google News app, Google Assistant, and Search have become a “walled garden” in which publishers and consumers are increasingly forced or encouraged to stay.
• Evidence that AMP, in which users read articles served by Google, benefits the platform to the detriment of news publishers who lose advertising revenue, reader data, and subscribers in comparison to organic search.
• Terms of Use are exclusionary and anticompetitive whereby consenting to the use of content for one product irrevocably binds the publisher to other products and services, some that directly compete with news publishers’ offerings.
• New evidence presented to the courts of anticompetitive practices around “header bidding” – an auctioning tool that competes against Google, producing a higher payout for publishers – was discouraged by Google as an intentional move to improve its financial gain in advertising auctions.
• Revelations that Facebook substantially curtailed its use of header bidding in return for Google giving Facebook a leg up in publishers’ web display and developers in app ad auctions, allocating a portion of the wins to Facebook and helping Facebook’s ad network, FAN, beat the competition.

As the Senate markup of the Journalism Competition & Preservation Act (JCPA) approaches (the Senate text was released in late August and it was listed to the Senate Judiciary Committee agenda for markup on September 8), critics of the bill have referred to it as a way to “prop up an industry that has largely failed to address its business problems” unrelated to the platforms. The White Paper proves this is not the case. If the platforms were required to come to the table and negotiate with news publishers for fair compensation for use of their content, as the JCPA specifies, it would address at least one critical piece of the gross marketplace imbalance with the dominant platforms.

Danielle Coffey, Executive Vice President and General Counsel at the News/Media Alliance said, “Google extracts revenue from valuable news content by deliberately and systematically delivering personalized information to users to keep them within their walled gardens. This fuels their engine of scraping reader data to sell their information and target them with ads.” Coffey continued, “There remains little bargaining power and, as a result, news publishers are forced to consent to nearly unlimited uses of their content in exchange for scraps to cover the tremendous investments it takes to produce quality journalism. If this continues, the production of quality local news content will be irreparably harmed.”

In the White Paper, the Alliance recommends passage of the Journalism Competition & Preservation Act, which would allow news publishers to collectively negotiate for fair compensation from the tech platforms.

The White Paper can be found here.

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

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Submitted to Department of Justice to Inform Investigation of Google’s Anticompetitive Behavior

FOR IMMEDIATE RELEASE

Arlington, VA – Today, the News Media Alliance released a White Paper, “How Google Abuses Its Position as a Market Dominant Platform to Strong-Arm News Publishers and Hurt Journalism.” The Alliance has submitted the White Paper to the Department of Justice (DOJ) as they proceed with an investigation of Google’s anticompetitive behavior.

The White Paper, which is based on more than a year of interviews and consultations with many Alliance members about their experiences with Google products, outlines several of the ways in which Google uses news content to its advantage across its products and services. The use of news content through AMP (Accelerated Mobile Pages), Google Discover, and the Google News app, as well as Search becoming more of a “walled garden” in which publishers and consumers are increasingly forced or encouraged to stay, has been systematically making use of news content to enhance Google’s bottom line. In exchange, because there is little bargaining power, news publishers are not receiving fair value for quality content.

“The leading copyright cases concerning search engines and aggregators are over a decade old and the precedent they created no longer reflects the realities of the modern online ecosystem,” stated Alliance Senior Vice President and General Counsel Danielle Coffey. “Despite the fact that the digital marketplace has changed and many of Google’s uses of news content may not be fair use under the current circumstances, there remains little bargaining power with Google and, as a result, news publishers must consent to these practically unlimited uses by Google without compensation, regardless of the strength of our copyright protections.”

Based on the conclusions reached in the White Paper, recommendations from the Alliance include:

• Antitrust scrutiny through the current investigations by the DOJ and state Attorneys General and remedies that address the abuses and impacts on news publishers.
• Passage of the safe harbor bill, also known as the Journalism Competition & Preservation Act, to allow news publishers to collectively negotiate for better business arrangements with the tech platforms.
• Compensation mechanisms that properly account for the value that platforms receive through original news content provided by established news organizations.

The White Paper can be found on the Alliance website here.

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Media Contact:
Lindsey Loving
Director, Communications
lindsey@newsmediaalliance.org
571.366.1009

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

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