The news industry is banding together to try to fight the power. In this day and age, that means Google and Facebook.
Besides many other things, those two tech giants now command the bulk of the ad revenue that news outlets have long relied on, leaving publishers scrambling to find solutions to stem the bleeding.
So a trade association representing about 2,000 newspapers in the United States and Canada — including this publication — will ask Congress to give it the right to bargain collectively with the Silicon Valley companies.
“Google and Facebook ’s duopolistic dominance of online advertising… could do far more damage to the free press than anything the president posts on Twitter,” David Chavern, president and CEO of the News Media Alliance, wrote in a Sunday op-ed in the Wall Street Journal.
Citing figures from the Interactive Advertising Bureau, Chavern says Google and Facebook “account for more than 70 percent of the $73 billion spent each year on digital advertising, and they eat up most of the growth.” He also cited numbers that support what many of us know: Most people get to their news by clicking on links in their Facebook news feeds, or from Google Search. Nearly 80 percent of all online referral traffic comes from those companies, according to Statista.
Why are publishers hoping that there is strength in numbers? They want to be able to push “for stronger intellectual-property protections, better support for subscription models and a fair share of revenue and data,” according to Chavern.
In 2016, newspaper revenue fell 10 percent to $18 billion compared with 8 percent the previous year, according to Pew, which analyzed the revenue of seven publicly traded newspaper companies. To put that in perspective, Google parent Alphabet’s net income was $19 billion last year, while Facebook’s was $10 billion.
But even as they lay off journalists left and right — almost 60 percent of newspaper jobs have been cut in the past quarter century, according to the U.S. Bureau of Labor Statistics — publishers aren’t worried about just the bottom line.
“Because of this digital duopoly, publishers are forced to surrender their content and play by their rules on how news and information is displayed, prioritized and monetized,” the News Media Alliance said in its press release Monday. “These rules have commoditized the news and given rise to fake news, which often cannot be differentiated from real news.”
Google and Facebook have initiatives to address the rise of fake news, and they are working with some news publishers on other issues. (For example, Google is funding news initiatives in Europe.) But some note that that’s small comfort to midsize news outlets.
“It is impossible for us to go as a one-off company and negotiate or even get an appointment with these companies,” Mike Klingensmith, publisher of The Star Tribune, told the New York Times.
The New York Times, which is part of the alliance, notes that the media alliance is asking for “long shot” legislation from a Congress that’s controlled by Republicans and is “not in a very press-friendly mood these days.”
Photo: The Daily Variety for sale at the newsstand on Laurel Canyon in Studio City, California, March 18, 2013, when it announced it would only publish once a week after 80 years of being a daily publication. (Anne Cusack/Los Angeles Times/MCT archives)
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