X snubs SA’s media inquiry
• Competition Commission irked as Musk’s platform cites legal reasons
X Corp is playing hardball with SA’s competition authorities, refusing to take part in a public inquiry into how digital channels are affecting traditional media platforms and advertising revenues — drawing sharp criticism from the antitrust watchdog.
The inquiry, which started public hearings on Monday, is designed to examine the impact of digital platforms such as X, which is owned by SA-born tycoon Elon Musk, Facebook and Google on the distribution and monetisation of media content, and whether they have anticompetitive or harmful practices that need to be addressed.
The Competition Commission has invited more than 50 potential stakeholders. Just more than 40 — including mainstream and community media, broadcasters, associations, think-tanks, social media platforms and ad brokers — are set to participate in the sessions, which will run until March 22.
X is the only major global platform that has declined to join the discussion, citing legal reasons.
“The panel does not find this position acceptable, as it denies us the ability to discuss and debate the submissions made by X Corp, and it denies the SA public and media the transparency and accountability,” said the commission’s chief economist and acting deputy commissioner, James Hodge.
“We also find it somewhat ironic that X has taken this position given its own value proposition to users being ‘a real-time, global, open, public conversation platform where people can see every side of a topic, discover news, share their perspectives, and engage in discussion and debate’.”
Sympathisers of Hodge’s comments could see X Corp’s snub as a sign of disregard for the interest of the SA public and media which could damage its reputation and trust among its users, who may see X Corp as unaccountable and unresponsive to their concerns.
His critics may point out that X Corp has the right to decline to participate in the inquiry for legal reasons and the company is not a cause or beneficiary of the challenges the media industry is facing in the digital era as it does not produce news content itself.
The commission said it would like to hear from the public and media whether they think X Corp should participate “and what questions you have of relevance to the inquiry scope”.
The first day of hearings saw presentations from the SA National Editors’ Forum, Press Council of SA, Association of Independent Publishers, Forum of Community Journalists and the International Fund for Public Interest Media.
In the coming weeks, the inquiry will also hear from mainstream players such as Business Day’s parent, Arena Holdings; Caxton; Media24; the SABC; eMedia; Primedia and Kagiso Media Radio.
Hodge said the inquiry was initiated to examine the distribution of media content on search and social media digital platforms, artificial intelligence chatbots and assisted search, and the advertising technology markets that connect advertisers and news publishers’ websites.
“The purpose is to determine if there are any market features that may be adversely affecting competition or undermining the purposes of the Competition Act, and to comprehensively remedy those features,” he said.
Estimates by the Wits journalism department show internet giants, including Facebook and Google, have taken as much as 60% of local advertising revenue over the past decade.
In recent years, a number of media houses have announced retrenchments as they streamline their operations to cope with the loss of advertising revenue, particularly for legacy businesses. This has resulted in media professionals losing their jobs, as well as companies such as Associated Media Publishing, which ran titles such as Cosmopolitan, shutting their doors.
Much of this has been attributed to the shift in the consumption of digital news sources as a result of smartphones and more affordable access to the internet.