Lawmakers are offering a public airing Tuesday to years of complaints from news companies about Silicon Valley’s growing wealth and power, as antitrust fervor in Washington creates a political opening for one of the tech industry’s most aggrieved critics.
Witnesses at a House Judiciary antitrust subcommittee hearing will include the general counsel of News Corp.
, publisher of The Wall Street Journal and the New York Post, whose executive Chairman Rupert Murdoch is a confidant of President Donald Trump. They also include the News Media Alliance, which represents publishers such as The New York Times and about 2,000 other print and online news outlets, in an industry that has suffered a tsunami of layoffs, buyouts, closures and consolidations while digital ad dollars flow to Google and Facebook.News organizations have warned for years that the two online giants’ dominance of digital advertising has stifled publishers’ ability to profit off their journalism. Tuesday’s hearing is the first in Judiciary’s broader investigation of whether Silicon Valley companies are engaging in anti-competitive conduct.
The Justice Department and Federal Trade Commission have separately begun to lay the groundwork for their own potential antitrust investigations of the major tech companies.
Kevin Riley, editor of The Atlanta Journal-Constitution, said publishers are simply seeking “a fair chance to compete” with the titans of Silicon Valley and find a sustainable business model for the digital age. They want the power to collectively negotiate the terms of sharing content with Google, Facebook and other online platforms.
“American business is built on the simple concept that the investor, as newspapers are investors in their content, will reap the rewards of that investment,” said Riley, who's scheduled to testify Tuesday. “We’ve got a situation now where newspapers don’t seem to reap those rewards, but others seem to.”
Ahead of the hearing, the News Media Alliance released a study that estimated Google made $4.7 billion in revenue in 2018 by scraping content from news publishers. The group's president, David Chavern, said the findings show “more money goes back to Google and not the publishers producing the content.”
But the study immediately came under fire over its methodology, with critics like Columbia University journalism school professors Emily Bell and Bill Grueskin saying it oversimplifies the financial relationship between platforms and publishers. A Google spokesperson also blasted the study, saying its "back of the envelope calculations are inaccurate" and arguing that Google News and Google search generate clicks for media websites, "which drive subscriptions and significant ad revenue."
Still, the power of Google and Facebook, which together account for a majority of the online ad revenue in the U.S., has become a point of bipartisan concern for lawmakers who say a functional press is crucial to maintaining a healthy democracy in an age of social media disinformation.
“This is not just the sale of widgets," House Judiciary antitrust Chairman David Cicilline (D-R.I.) told CNN on Sunday. "This is about voters’ ability, the American people’s ability to access trustworthy, reliable local news, to hold officials to account, to expose corruption. This is a centerpiece of our democracy.”
Such concerns about the media's survival coincide with steady media attacks from political figures including Trump, who routinely disparages journalists as “enemies of the people” and peddlers of “fake news.” And one of the main targets of Trump’s media criticism is The Washington Post — a news outlet owned by one of the tech industry’s most powerful executives, Amazon CEO Jeff Bezos.
Some in D.C. questioned the need for the House hearing at all.
The committee should “avoid creating a political platform for aggrieved industries and companies to complain about their competitors," said Billy Easley, policy analyst for Americans for Prosperity, the Koch network's policy and political arm. Carl Szabo of e-commerce trade group NetChoice, which counts Google and Facebook as members, blasted the hearing as “an attack on social media by big media companies upset that they no longer control our news and views.”
Many in the news business back the Journalism Competition and Preservation Act from Cicilline and House Judiciary ranking member Doug Collins (R-Ga.). It would grant publishers a four-year antitrust exemption to allow them to negotiate together with internet companies. Sens. Amy Klobuchar (D-Minn.) and John Neely Kennedy (R-La.) last week released a companion bill in their chamber.
Chavern of the News Media Alliance said the measure would given publishers a chance to shape how their content generates revenue, who controls data collected from readers and how tech companies prioritize certain stories over others.
“In the online world there are two companies that stand between news publishers and the public, and that’s Google and Facebook,” he said. “They determine everything about our relationship with our customer, including what news gets delivered to who and when, whether it’s monetized and really whether we live or die.”
But Gene Kimmelman, a former Justice Department official and president of consumer advocacy group Public Knowledge, said he's worried that only the biggest media organizations would get a seat at the bargaining table with Facebook and Google, leaving behind small publishers and their interests.
“We are equally concerned about enhancing the power of a few large media companies to dominate a marketplace of ideas,” he said.
Kimmelman's group favors other kinds of congressional actions against the tech industry, including imposing new data privacy restrictions.
(Axel Springer, which co-owns POLITICO Europe, is a staunch critic of Google’s practices. The company is not testifying at Tuesday's House hearing.)
Article originally published on POLITICO Magazine