Duopoly

What presently most endangers a free press in the US is not Donald Trump. The institutions that protect America’s Fourth Estate will most likely survive the assaults of the orange mountebank, his cult and their preference for conspiracy theory over objective realities that do not suit them.

A more immediate worry is the duopoly, as Facebook and Google are increasingly referred to by those who fret about the stifling power these platforms have amassed. It is a power felt not just in the US but globally, not least by Business Day in whichever form you are consuming it.

A thousand or so American journalists got the chop just last week when the owners of Buzzfeed and Verizon, the telephone company that owns the Huffington Post, found the news business insufficiently profitable, at least within the quarterly horizons of Wall Street.

Gannett, the nation’s largest newspaper chain, simultaneously announced it was slashing Pulitzer-calibre newsroom muscle at its titles, big and small, around the country. This was either to entice, or, on a more generous interpretation, to raise the company’s share price and so head off,  the hyenas of private equity drawn by the scent of leverageable and strippable assets to be had for a song.

What is giving these assets the carrion aroma? Fingers are pointed in many directions but Facebook’s Mark Zuckerberg and his inhouse grown-up, Sheryl  ”lean in” Sandberg, have become prime suspects. They, Google and, to a lesser extent Amazon, have cornered the advertising revenues that were the lifeblood of the Fourth Estate. Or so it is argued.

Never in history have so many so willingly surrendered so much valuable information about themselves, their tastes, desires and proclivities to so few for so little.

If I have a car to sell in Podunk, why would I pay for an ad in the Podunk Picayune, or on its feeble excuse for a website, on the off chance that a reader in the circulation area might be interested, when Facebook for a fraction of the price can present my car to punters nationwide identified by its algorithm as hot for what I’m selling?

Should then the Podunk Picayune, which keeps its community informed and engaged and its officials honest, be allowed to shrivel and die, or be sold to a New York hedge fund to have the last marrow sucked from its bones, simply because it cannot compete with the behemoth Facebook in selling ads?

Congressman David Cicilline, Democrat of Rhode Island, says no. He is now the chairman of the House committee that deals with monopoly policy. Last year, his party out power, he introduced what he dubbed the Journalism Competition and Preservation Act. It went nowhere. On Tuesday, he reintroduced his bill to the applause of the News Media Alliance which represents some 2 000 news organisations in the US and beyond.

Facebook and Google attract eyeballs, and generate ad revenues, serving up content  others have produced, either through search results or in newsfeeds. Members of the News Media Alliance would like to be properly compensated by the duopoly for use of their content — and to be able to deny Facebook and Google access to their content absent a more equitable sharing of ad revenues. Under current law, collective action by content producers to force concessions from the platforms would be illegal collusion.To level the field,  Rep. Cicilline proposes giving media safe harbour against antitrust prosecution for four years.

Others such as Matt Stoller of the Open Markets Institute advocate going further and using antitrust law to block Facebook and Google from selling targeted ads altogether. That would entail a radical shift in their business models, with a potentially huge impact on their market valuations. It’s hard to predict how this will all shake out.

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