Tech

Coronavirus reignites feud between publishers and platforms

In the age of COVID-19, people are flocking to news outlets in record numbers.

Theres only one problem: Journalism is going broke.

As the pandemic rages, publishers are facing a triple threat of plummeting advertising revenue, an economic downturn thats hitting subscriptions, and nationwide lockdowns that make it challenging to report on the latest developments.

The existential threat — thousands of journalists have either been furloughed or laid off, and outlets across the United States, Europe and elsewhere are starting to shutter — is reigniting a long-standing feud between publishers and the duo of Google and Facebook.

In France, the competition authority ordered Google to work with newspapers over licensing fees when using their content. In Australia, politicians said they would write rules by July to force digital platforms to fork over cash if they display publishers material on social media.

In recent weeks, Facebook and Google announced multimillion-dollar aid packages for local and national media outlets around the globe.

While these moves were in the works before the current crisis, industry lobbyists and some lawmakers see them as opportunities to demand more money from Google and Facebook in support of struggling media outlets.

“Those who use [publishers] content must pay for it,” Franck Riester, Frances culture minister, said in response to the antitrust agencys decision against Google on April 9. “The health crisis we are going through reminds us, once again, of the essential nature in any democracy of the mission to inform.”

The tech companies have been quick to respond.

In recent weeks, Facebook and Google announced multimillion-dollar aid packages for local and national media outlets around the globe. The search giant also said it would waive fees for publishers using its ad network to prop up their flagging online revenues and, some argue, to woo skeptics who say tech companies have hurt publishers livelihoods.

“Its no accident its France and Australia where you see this happening,” said Rasmus Kleis Nielsen, director of the Reuters Institute for the Study of Journalism at the University of Oxford, who added that local politicians in both countries have been more willing than lawmakers elsewhere to target the digital platforms.

“Countries like Germany where theres a lot of political sympathy for that argument will likely follow,” he added. “Its where publishers have been aggressively fighting their corner.”

From the frying pan to the fire

The global public health crisis did not start this political fight.

For years, media outlets have complained that tech giants siphoned off advertising revenue and users personal data in ways that hurt their bottom line. The European Unions controversial copyright rules, passed just over a year ago, also have given newspapers new ammunition to demand payment when their content shows up on Google News or on Facebook.

The platforms deny these accusations. They claim online advertising spending — still the lifeblood of many outlets — has shifted to social media as peoples attention has moved from news sites to Google and Facebook. The companies also argue their platforms, used by billions of people worldwide, allow media outlets to quickly reach new readers in ways not imaginable before the social media era.

These arguments, so far, have gone down better in the U.S. than elsewhere, particularly in Europe where publishers have lobbied heavily to reduce the tech companies perceived dominance over key industries like online advertising.

Yet COVID-19 has turned up the pressure in this “frenemy” relationship between the media and digital platforms.

Widespread lockdowns have brought sales of many print publications to a grinding halt. Digital advertising revenue, on average, is expected to fall by up to 25 percent over the next three months, according to a survey of advertising executives by the Interactive Advertising Bureau (IAB), a trade body.

And just as worrying, almost three out of four corporate advertising buyers polled by the IAB said they would change how much they spend on media campaigns because of the oncoming recession.

“This is an entirely different beast,” said David Cohen, the IABs president, when asked how the current slowdown compared with the 2008 global financial crisis. “Were in a time when news has never been more important, but advertising support is declining.”

Let the lobbying commence

Angela Mills Wade is no stranger to this fight.

As executive director of the European Publishers Council, a trade body whose members include News UK, the New York Times and Axel Springer (a co-owner of POLITICOs European edition), she has seen the industry struggle to change its ways long before the global pandemic.

“What the crisis has exposed is the underlying trends in the industry,” she said. “Advertising has always been part of the mix for companies. Its really important that theres some way to fund content for citizens, free at the point of access, for media brands that people trust.”

Mills Wade, a frequent critic of the tech giants, said the current online advertising world — dominated by Google and Facebook — had left publishers at a disadvantage, and that regulators now must step in to alter the balance.

“Well continue to support the news industry during this incredibly difficult time and beyond to help build sustainable business models” — Campbell Brown, Facebooks vice president of global news partnerships

With officials in Brussels and other capitals increasingly warning about the potential life-threatening effects of coronavirus misinformation, she said the importance of an independent media industry has quickly become clear for policymakers.

“A crisis is always good for people to understand whats happening,” Mills Wade said. “Thats helping the European Commission understand the commercial situation that news Read More – Source

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