CCI to probe Google’s ‘abuse of dominance’ in ad revenue
THE DIGITAL NEWS PUBLISHERS ASSOCIATION HAS ALLEGED THAT GOOGLE’S BEHAVIOUR RESULTED IN DENIAL OF A FAIR SHARE IN DIGITAL ADVERTISING REVENUE TO NEWS PUBLISHERS
NEW DELHI: The Competition Commission of India (CCI) has ordered an inquiry into Google’s alleged denial of a fair share in digital advertising revenue to news publishers on the basis of a complaint filed by the Digital News Publishers Association.
The order posted on the website of the competition regulator said that a prima facie case is made out against the alleged conduct of Google, which merits an investigation. Google would have sufficient opportunity to present its case during the investigation, it said. The watchdog asked its Director General of Investigation to give a report in 60 days. The regulator also said nothing mentioned in its order amounts to a final expression of opinion on the merits of the case.
The Digital News Publishers Association alleged in its petition that Google’s behaviour resulted in denial of a fair share in the digital advertising revenue to news publishers and disclosure of inadequate information to reach a fair settlement.
The petition said the newspaper industry in India has sustained itself on a business model driven by advertising, which accounts for two-thirds of its total revenue and only one-third of its total revenue from subscriptions by readers. Further, the digitalisation of the economy has resulted in higher spending on digital advertising, increasing the dependence of the news publishers on digital advertising, it said.
An email sent on Saturday to Alphabet Inc., Google’s parent company, seeking comments for this report remained unanswered at the time of publishing.
“The Commission also takes note of the development in some countries such as France and Australia, as referred by the informant (the Digital News Publishers Association), that Google has been asked to enter into fair/ good-faith negotiation with news publishers for paid licensing of content to address the bargaining power imbalance between the two and the resultant imposition of unfair conditions by Google. No doubt, Google, being the gateway, generates substantial traffic for news publishers, but at the same time, the bargaining power imbalance and denial of a fair share in the advertising revenue, as alleged by the Informant, merit detailed investigation,” CCI said in its order.
The Digital News Publishers Association said in its petition that its members engaged in the business of news media have endeavoured to provide credible and fact-checked news, which is the bedrock of any democracy. They have invested and continue to invest a sizeable amount of money to train their journalists and other officials, hire reporters and invest in production to provide credible news, the Association said.
It also said the media industry has been one of the hardesthit sectors during the pandemic. The pandemic has accelerated the transition of consumers of news from traditional print and television media to digital channels, it said.