Minority report slams Google, Facebook for decimating local news media outlets
“Unfair, deceptive, and abusive practices” by tech giants Google and Facebook have suffocated local news outlets, contributing to a critical deficit of trustworthy local journalism, according to a new minority report from the Senate Commerce Committee released by ranking member Sen. Maria Cantwell, D-Wash.
The report, echoing a landmark antitrust suit filed last week against Google by the Justice Department, concludes that Google and Facebook have used their sheer heft to dominate the digital advertising market, to the detriment of local media outlets and an informed public.
“These trillion-dollar companies scrape local news content and data for their own sites and leverage their market dominance to force local news to accept little to nothing for their intellectual property,” the report claims. “There is a clear need for Congress to address the market failures created by the search and social-media platforms.”
The report from the Commerce Committee’s Democratic minority recommends Congress require that Facebook and Google negotiate payment terms with local media outlets for the headlines, photos and summaries driving a sizable amount of traffic on their sites. Some European countries and Australia have passed or proposed similar rules.
It also suggests Congress could equip federal agencies with “new or expanded authorities” to address what it calls the undue influence tech platforms exert over contracts with local news outlets.
“Local journalism has been the policeman on the beat against misinformation,” Cantwell said in an interview Tuesday. “Keeping local news is too important to let these unfair market practices continue.”
Nationally, newsrooms lost nearly half their staffs between 2008 and 2017, according to a Pew Research study. Nearly 1,800 newspapers have folded since 2004, leaving 200 counties nationwide without a local newspaper, according to the University of North Carolina.
The pandemic has accelerated a trend of sharp job losses and revenue shortfalls. More than 7,000 local reporters could lose their jobs by the end of 2020, the report estimates, nearly three times the number of reporters who have left the industry each year since 2005.
Google and Facebook disputed the report’s claims that their business practices have helped decimate the local news industry.
“The traditional news-publisher business model is clearly facing enormous challenges, but this report misrepresents Google’s role in the online news ecosystem,” said Google spokesperson Maggie
Shiels in a statement. Google sends “people to news sites 24 billion times a month” and helps “publishers make money with our advertising products,” Shiels noted.
Similarly, Facebook spokesperson Adam Isserlis said it “give(s) news organizations the ability to post news on Facebook free of charge, and they have full control over how that content is accessed and monetized.”
To be sure, a combination of factors are to blame for the decline of local news, said Seattle Times President Alan Fisco. Competition from free online news sources, a steep drop in advertising prices and corporate consolidation have all played a role, the report notes.
Fisco said local newspapers, including The Seattle Times, have been able to innovate in response to those challenges. Trying to outplay big tech in the realm of digital advertising, though, forces local news outlets to compete on a horrendously uneven field, Fisco said. The Seattle Times’ leadership has lobbied for a profit-sharing arrangement with tech companies.
“How do you compete against the likes of Facebook, who mine a phenomenal amount of data to provide much better targeted advertising than we can?” Fisco asked. “We spend millions and millions of dollars on news-gathering costs. The likes of Google and Facebook take that content for free to keep people on their sites.”