Quick thread on the whole Australia/Facebook/Google standoff.
Frustrating situation with a lot at stake. And fundamentally opaque. There is so much we don't know, leaving space for self-interested assertions on all sides.
But we do know some things. 1/16
Frustrating situation with a lot at stake. And fundamentally opaque. There is so much we don't know, leaving space for self-interested assertions on all sides.
But we do know some things. 1/16
First, old biz of news is in inexorable structural decline and new biz of news will in almost every case never generate same revenues, esp given dominance of platforms such as FB+G in ad market. This=newsroom cuts plus very real risk of market failure rasmuskleisnielsen.files.wordpress.com/2018/05/nielse… 2/16
Second, if public and elected officials who represent them agree these market failures merits public intervention, there are tools available. Public service, subsidies for private media, easing road for non-profit, etc. Written about some of them here reutersinstitute.politics.ox.ac.uk/our-research/w… 3/16
Third, there are obviously wider issues here that go well beyond news and are Qs of competition law and enforcement in digital marketplace. Cremer et al, Furman et al & others have outlined options in that space. These strike me as sensible but probably won't help news much 4/16
Now, normally, when we decide to use public funds to solve a public problem, we use general taxation to fund specific policies. Strikes me as a rational approach here too, rather than attempts to effectively politically dictate prices. (So tax the F out of tech companies.) 5/16
If one instead ends up focusing on political intervention in intercorporate battles to shore up specific private companies how much money could concievably be channeled from tech cos to news cos before the tech cos exit a market? This is kind of important, and we do not know 6/16
Personally, I'd leave aside self-interested assertions and commissioned consultancy pieces, and use comScore data on % of time spend online that is spend w/news as rough guide (often 3-5%). I'd be surprised if news is much smaller or much bigger part of large platforms. 7/16
Currently that news is largely provided on basis of the decades old exchange: publishers provide platforms with content and platforms provide publishers with reach. Platforms are happy with this. Most publishers have acquiesced to it. Note: every platforms take this approach 8/16
The platforms' position is clear: reach we provide has value. Publishers' is also clear: we want more. Platforms response? Good for you. Here are some product features and other adjustments and maybe an innovation grant, and of course you are free to leave bcs most will stay 9/16
What might happen if a government intervenes to change the terms? If $ involved is small enough, platforms might grumble but accept. But if $ involved is small, publishers won't be happy. And as long as we don't have data we'll have never-ending purely political discussion. 10/16
If, on the other hand, $ is too big, platforms will threaten to exit market or curtail services. Google Spain is forerunner to this, as are various other footnotes in these tussles in Europe, but obviously Facebook, Google Search, and/or YouTube would be vastly bigger deal. 11/16
What would that mean?
Again, we don't know, it has never happened, but I think existing research gives us a sense of what it might mean for news media and what it might mean for citizens. 12/16
Again, we don't know, it has never happened, but I think existing research gives us a sense of what it might mean for news media and what it might mean for citizens. 12/16
News media first: Australia may be different, but if UK is anything to go by, direct discovery is more concentrated than distributed (search+social). So big news sites could see bit more traffic, even as others decline. That's what happened in Spain: gsb.stanford.edu/faculty-resear… 13/16
Citizens next: in Australia, 24% name going direct their main way of accessing online news, esp older+more affluent people. 26% named social, esp younger. News lovers will be fine, but overall expect news consumption to decline+inequality to increase reutersinstitute.politics.ox.ac.uk/our-research/s… 14/16
So messy. Glad Australian policymakers want to support news. But approach taken-direct intervention in intercorporate battles-seems fraught w/risks. From policy POV, simpler solution would be using general taxation (including taxing the F out of big tech) to provide support 15/16
But from political POV, leaving aside pressure from publishers (some of whom have a... political record in Australia), how many politicians will campaign on "higher taxes and more journalists"? 38% trust news in Australia. I'd make the case, but I don't have to be elected. 16/16
