Make no mistake, this legal framework - which most people think of as simply promoting competition - today already allocates economic coordination rights to large, powerful corporations such as Google and Facebook, to the detriment of smaller players. The bill also creates a carve-out from federal antitrust law, the statutory framework that regulates economic competition and coordination. The largest national newspapers and television networks would be excluded and the legislation would sunset after eight years. It would authorize news outlets to create “joint negotiating entities” to bargain for compensation from internet platforms for the news stories they use it would also require binding arbitration if there’s no agreement over a specified period of months. That is exactly what the bipartisan Journalism Competition and Preservation Act, currently in Congress, would do. Yet, the law prevents journalistic enterprises from coordinating among themselves to bargain with these giant platforms for the value of their product.Ī straightforward solution to the problem is to allow the newspapers and media companies to band together for the purpose of negotiating with the internet platforms for payment for the content they create. These dominant internet platforms have effectively collected market power within their own corporate boundaries, ultimately allowing them to dictate terms to other businesses whose content they use. It’s important to recognize what is driving the problem here: It isn’t the “free market” or even technological changes per se, but the specific market design, which the law helps to shape. Hence, the devastating decline in the entire sector. Needless to say, this is not economically sustainable. This means that even when their work has delivered value to the public, the businesses actually investing in and doing the work of journalism can’t earn sufficient advertising revenue to cover their costs. But 65% of these users do not click through to the news publishers’ websites.
A huge number of search results on Google link to news stories, reproducing enough content for users to consume. A major factor in this decline is the rise of powerful internet platforms, like Google and Facebook, which currently control the bulk of digital advertising and have become the main source of news for many Americans.
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