In the last few weeks, France and Australia have taken significant steps to make news aggregators such as Google pay for re-use of news. The beneficiaries will be news publishers, who for years have been struggling to make a digital transition. While the competition regulator in France has effectively pushed Google into negotiating a remuneration deal with publishers, Australia has proposed to make platforms pay for use of news. In a discussion moderated by Sriram Srinivasan, Rasmus Kleis Nielsen, Director, Reuters Institute for the Study of Journalism, and Parminder Jeet Singh, Executive Director, IT for Change, discuss whether governments should intervene in correcting lopsided platform-publisher relationships.
What do you make of these developments?
Rasmus Kleis Nielsen: It is a clear political recognition of how difficult many publishers find it to build a sustainable business in the digital space. It is also a political recognition in some quarters, that while independent professional journalism is often inconvenient for people in power, it is fundamentally also a public good. And if the market on its own does not provide this public good [at] the level that we want in a society, then there is room for political intervention.
In the developments we see in Australia and France, there is focus on a very particular type of response, which is to force one part of the private sector to transfer money to another part of the private sector. This is quite an unusual approach.
Parminder Jeet Singh : To the question that the government needs to step in, in managing the relationship between platforms and media, I would say yes. But I would also warn against doing it in a ‘plug-the-leak-here and patch-a-tear-in-the-fabric there’ kind of approach. It won’t work.
And you have seen it since at least 2014, governments trying to make platforms pay for news snippets and the difficulties in doing that. So, we need to place this problem in the larger problem of the relationship of digital platforms in all sectors, with those small actors who are dependent on the platform. In that sense, this problem is not very different from the problem that small traders have with Amazon platform.
But some commentators point out that it is an important step because it is about shoring up what they consider an essential industry. What do you think of that?
Parminder Jeet Singh: Yes, the media is a very different kind of essential industry. What I am saying is that unless we understand the nature of digital power — what is that platforms have power because of, and go and address those issues — we will not succeed. I completely agree that measures are needed to protect the media sector now. And therefore, even patchwork attempts are good.
Is there an agreement that the platforms have disproportionate clout when dealing with publishers, and this skewed relationship needs to be addressed somehow, if not in this manner?
Rasmus Kleis Nielsen: It is clear that the largest platform companies are extremely powerful, and that their power extends to all the different fields that they’re active in. It is important for us to recognise at the same time that this power is a problem, because unaccountable power is always problematic. But I think it is also worth recognising that the root of this power is relations. It is the choices made by billions of end users and millions of third parties who embrace large platforms because they feel that they benefit from working with them, even as they also rightly have reservations about the power of these companies.
The challenge from a public policy point of view is how can you first ensure a competitive and transparent digital economy where you prevent the abuse of dominant positions, without punishing success or simply protecting incumbent industries who will always scream ‘blue murder’ when new entrants disrupt their old and profitable businesses.
Parminder Jeet Singh: There is no lack of recognition of the platform power. But what is lacking is (an effort) to then dig down and find out the nature of the platform power. There are a lot of tough decisions to be taken at the top of the political economy system, of who owns the data, whether platforms are essential utilities, whether they should be regulated as utilities, and so on. Also, there is a geopolitical angle. No country can on its own do it because then it becomes a race to the bottom, and the Facebooks and the Googles of this world will always say that we are moving out and the next country is ready to take us.
There have been attempts in the past to address this skewed relationship but they haven’t been successful. With the world fighting coronavirus, is this now an opportunity for administrators to sort this out in a different way?
Rasmus Kleis Nielsen: The current situation underlines the way in which a limited number of large for-profit, U.S.-based companies have very quickly become a small part of almost everything almost everybody does almost everywhere. This is leading a lot of governments to consider a much more robust intervention in this space than they have probably considered in the recent past.
That doesn’t necessarily mean that everyone will welcome every kind of government intervention in this space. And how one thinks of government intervention in the space depends in large part on how much confidence one has in government in general. Governments are not disinterested neutral actors in the sort of purely idealistic pursuit of the public interest in all cases.
I want to bring you both in on gauging what is happening in France and Australia from the lens of what role the government is playing.
Rasmus Kleis Nielsen: The particular model that’s being considered in Australia and France, I would be very interested to see more details on how exactly it is proposed to work. It is not a model we use to fund public services in general. We don’t fund public education by taxing a few big companies solely for that purpose. We don’t fund the public health system by taxing a few large companies solely for that purpose. The normal approach is general taxation and then political positions about where we allocate that money. And I think this sort of form of enforcement of B2B relationships or hypothecated taxes from one sector to another is one that is quite complicated. And it tends to be quite vulnerable to people with clever lawyers and clever accountants and the like to find loopholes. And so it is not obvious to me that it is necessarily the best way to achieve the public interest goal of funding independent professional journalism. But the goal itself, I personally have a lot of sympathy for.
Parminder Jeet Singh: I understand Rasmus saying that there are difficulties in this model. I wouldn’t call it a tax. But what they’re trying to do is to have a fair sharing of value. And the problem here is that fair sharing of value does not take place because we have not gone down deep enough to recognise what is the nature of the value that the platform brings by controlling the channels of distribution access, and interconnection, which is one kind of value that a platform brings. The second kind of value a platform brings is through data and data-based intelligence that it develops and how therefore it uses that intelligence to control and orchestrate all other actors and puts them at a disadvantage, power-wise.
There’s also a sense that over the years, the primary tool that governments used against such aggregators was the copyright law. And now it seems that the competition law is becoming an important tool. Do you see that direction?
Parminder Jeet Singh: Yeah, I think so. But both are industrial-era attempts to solve a digital-era problem. And in the digital platforms, much of the economic interactions do not take place in the nature of typical markets.
India has now a committee of experts by the IT Ministry which is talking about the value of data, including non-personal data and how its economic value should be distributed and so on. We need to get down to those basics. And without that, we would not be able to solve these problems.
Rasmus Kleis Nielsen: There’s probably three basic sides to this. The first is what we can do with the tools that we already have? We also need to recognise that there are some very large companies by now who have built up their position over 10 or 20 years. And that developing entirely new regulatory and policy tools will take time. So, if we want to do something in the short term, it is primarily about how we can use existing rules of competition law, data protection and privacy regulation and the like to ensure that we have a more competitive digital economy that benefits citizens and all legitimate interests. And I am very encouraged by some of the steps being taken in the European Union to do that.
It is really important to recognise, speaking narrowly about news, that the general policy goal in competition is not to protect competitors, but to protect competition and that we cannot assume, a priori , that new regulation in this space will benefit news publishers specifically. That is why we need to make a political decision about whether there is broad public support for the idea that independent professional journalism is in public interest and is a public good, and needs to benefit from public funding. That’s largely separate from the discussion on platforms and competition.
There’s a geopolitical angle too. Many of the large and dominant technology companies are American. And the American government does sometimes let slip that they’re keenly aware of this and that they will fight their corner. Many of their main competitors are from mainland China. And it is also clear that the regime in Beijing is not naive about the assets that this represents. We just need to recognise that when governments elsewhere are thinking about intervention in this space, it could also be because they themselves think that national champions are in their geopolitical self-interest. Now, how important that is, I think it is a political question. I can totally understand why the French government might like to see a French YouTube or French search engine or something like that instead of American ones. But it is not obvious that journalism would benefit more from a relationship with a French search engine or a French video-sharing platform than from a relationship with American platforms.
How do you see this from the point of view of the general Internet user? And also, do you see that the publishers have got onto something which they have never had in many years?
Parminder Jeet Singh: I see hope. There will be difficulty in trying to do what they’re doing right now. But there is a sense of urgency among major countries, and that sense of urgency will make them stick to trying to do something and this time around there would be more sustained progress. There is good traction now for things to move forward and things will move forward much faster now. People would learn lessons in much shorter cycles. And these kinds of moves are good because they are an attempt to correct the power imbalance and people would add more systemic responses as well.
Rasmus Kleis Nielsen: We need to just confront the fact that most politicians around the world regard independent journalism at best with benign indifference, more often with rank hypocrisy, and very often with open hostility. And that many governments have a very mixed record in terms of how they deal with independent news media. Now the fact that in two out of 193 countries that are members of the United Nations, there now seems to be some move to change this, is potentially encouraging. But I don’t think we should consider that a trend until we see a much larger number of countries take such steps. France has a long tradition of intervention within this space. Australia is a country where there’s a conservative government, and a very well known conservative media owner, who has been very active in this space for a long time.
The only people who care about figuring out the future of the business of news are those who are in it, those who believe in the editorial principles but also the practical commercial realities of digital journalism. Now, in that space, I am an optimist, a cautious optimist but an optimist nonetheless.
Parminder Jeet Singh is Executive Director, IT for Change; Rasmus Kleis Nielsen is Director, Reuters Institute for the Study of Journalism.