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Antitrust

Among Their Many Ills, Critics Say Google and Facebook Make It Difficult for Digital Media to Survive

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WASHINGTON, June 11, 2019 — The practices of Google and Facebook were closely scrutinized at a House Antitrust Subcommittee hearing Tuesday, and the companies’ impact upon the digital news media came in for particularly stark criticism.

Some said that these major tech platforms were making it difficult for other media companies to survive, speaking at a broader inquiry of the companies before the House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law.

According to News Media Alliance President David Chavern, 93 percent of Americans get their news online. The majority of this stems from just two platforms: Facebook and Google.

These platforms are “controlling the game and playing it too,” said Sally Hubbard, director of enforcement strategy at the Open Markets Institute, a progressive think tank seeking greater antitrust activity. By both competing against and capitalizing off of news media, the tech giants are making fair competition “impossible.”

Increased competition could potentially allow consumers the option of picking a platform that doesn’t use engagement algorithms that boost propaganda.

Hubbard pointed out that most disinformation also comes from Facebook and Google, claiming that “by prioritizing engagement, these platforms are actually promoting disinformation as well.” Content that inspires fear or anger is more likely to be engaged with, whether or not it is true.

Facebook and Google lack competition and regulation and have grown with impunity, said Hubbard. Since 2013, the two platforms together have bought more than 150 companies.

This lack of competition makes the digital news ecosystem completely reliant on two platforms in which a small algorithm change can completely alter what articles are shown to which people, she said.

And she said that that, in turn, can have a major effect on not only the publishers’ revenue streams but also on public opinion, as shown by election interference in 2016.

Facebook has acquired competitive social networks like Instagram and WhatsApp. Facebook specifically identified WhatsApp as a threat before purchasing it, Hubbard said.

Meanwhile, Google has taken over the display advertising market by acquiring companies such as DoubleClick. Antitrust prosecutions against Google in Europe have held that the company prioritizes its own products and search results over that of rivals.

Computer & Communications Industry Association Vice President Matt Schruers took issue with these allegations, and didn’t see a problem with Google’s practices. Grocery stores are allowed to promote their own brand of products above others.

But other critics said that tech platforms are steadily draining revenue from news organizations through their control of advertising revenue.

Chavern said Facebook and Google are profiting off digital news industry in two ways:

“First, they scrape news organizations’ content and display it on their own pages, where they can monetize it through ads,” said Chavern. “Second, they control the advertising technology news organizations use to sell ads on their own sites, and the platforms charge increasingly exorbitant fees for use of those technologies.”

Brand suppression is a big problem with the major platforms’ display of news media. This is both bad for publishers because it takes away from their brand and bad for the public because it takes away from their ability to know the source of their news.

Schruers disagreed with Chavern’s analysis, citing a study which said that dispersing stories on social media to “road-test” them is beneficial to journalists and reporters. Rep. Joe Neguse, D-Colorado, said that the study in question was funded by Facebook.

The lack of privacy rules also plays a deeply-related role, said Hubbard. If platforms gathered less data from consumers, they would be less able to hyper-target them.

(Photo of hearing by Emily McPhie.)

Development Associate Emily McPhie studied communication design and writing at Washington University in St. Louis, where she was a managing editor for campus publication Student Life. She is a founding board member of Code Open Sesame, an organization that teaches computer skills to underprivileged children in six cities across Southern California.

Antitrust

American Innovation and Choice Online Act Advances to Senate Floor With Bipartisan Alliance

Klobuchar was able to rally Democrats and Republicans to support her bill, but its future depends upon a shaky alliance.

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Sen. Amy Klobuchar

WASHINGTON, January 21, 2022 – Senators on the Senate Judiciary Committee have formed a tenuous, bipartisan alliance to curb allegedly anticompetitive behavior by large tech companies.

During a Thursday markup, the Senate Judiciary Committee voted 16-6 to send the American Innovation and Choice Online Act, S. 2992, to the Senate floor. The bill would prohibit certain companies with online platforms from engaging in behavior that discriminates against their competitors.

There is a laundry list of violations and unlawful behaviors enumerated in the bill, including unfairly preferencing products, limiting another business’ ability to operate on a platform, or discriminating against competing products and services.

This bill would only apply to companies with online platforms that meet one of the following criteria:

  • Has at least 50,000,000 United States-based monthly active users on the online platform or 100,000 United States-based monthly active business users on the online platform
  • Is owned or controlled by a person with United States net annual sales or a market capitalization greater than $550,000,000,000, adjusted for inflation on the basis of the Consumer Price Index and is a critical trading partner for the sale or provision of any product or service offered on or directly related to the online platform

Sen. Amy Klobuchar, D-Minn., the sponsor of the bill, referred to the bipartisan effort as “the Ocean’s 11 of co-sponsors,” featuring a diverse line-up of legislators, from Sen. Josh Hawley, R-Miss., and Sen. John Kennedy, R-La., to Sen. Dick Durban, D-Ill., and Sen. Richard Blumenthal, D-Conn.

Senators embrace specific and direct targeting of Big Tech

Klobuchar spoke directly about the need to target large companies, “We have to look at this differently that just startup in a garage – that is not what they are anymore. They may have started small, but they are [now] dominant platforms,” she said. “For the first time, the monopoly power is going to be challenged in what I consider to be a smart way.”

At the outset of the meeting, there were more than 100 amendments proposed by members of the committee, but by its conclusion, more than 80 of them had been withdrawn.

One of the amendments that worked its way into the bill was a markup that exempted subscription-based services from complying with the legislation, allowing services like Amazon Prime and Netflix to promote their own content above others’.

“The bill strikes the right balance between preventing the conduct that hurts competition, while also ensuring that platforms can continue to provide privacy and data security features to their users, compete against rivals in the United States and abroad, and maintain services that benefit consumers,” Klobuchar said.

A fragile alliance between read-meat Republicans and progressive Democrats

Though there were big names on both sides of the aisle supporting the bill, the alliance seemed fraught. Despite being supportive of the bill, Kennedy made it clear that his support was conditional. “I am a co-sponsor of this bill, but this bill is going to change – it is going to change dramatically,” he said. “I hope to be in the room when those changes are made, otherwise I will be off this bill faster than you can say ‘Big Tech.’”

Some of Kennedy’s criticisms harkened back to Section 230 issues raised by former President Donald Trump – calling some of the targeted companies “killing fields for the truth,” and stating that “their censorship is a threat to the first amendment.”

Despite his criticisms, Kennedy echoed other senators, both Republican and Democrat, who emphasized that they did not want the perfect to become the enemy of the good. “All we have done [for five years] is strut around, issue press releases, hold hearings, and do nothing. So, this is a start.”

Klobuchar also received push-back from members of her own party, with Sen. Dianne Feinstein, D-Calif., stating that she was critical of the bill because it is designed to specifically target large tech companies, many of which are based out of California (though she ultimately voted to advance the bill to the Senate floor).

Hawley rebuffed Feinstein in his comments, stating that he supports the bill for the same reason Feinstein refuses to. “[Feinstein] pointed out – I think rightly – that this bill is very specific and does target specific behavior – anti-competitive behavior – in a specific set of markets. I think that that’s a virtue and not a vice.”

The measure must be passed by the full Senate, as well as the House, before it goes to the president for his signature.

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Antitrust

CES 2022: Patreon Policy Director Says Antitrust Regulators Need More Resources

To find the best way to regulate technology, antitrust regulators need more tools to maintain fairness in the digital economy.

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Larent Crenshaw (left), head of Patreon's global policy team

LAS VEGAS, January 7, 2021 – The head of Patreon’s global policy team said federal regulators need more resources to stay informed about technology trends.

Laurent Crenshaw told CES 2022 participants Friday that Congress should provide tools for agencies like the Federal Trade Commission to enforce consumer protection standards.

“I’m not going to say that big tech needs to be broken up, but there should be appropriate resources for federal regulators to understand the digital marketplace,” he said. “We’re are still living in a world that is dominated by big actors, and we’re debating about whether to even give federal regulators the power to understand how the marketplace is moving toward digital.”

Crenshaw of Patreon said that more resources were necessary at the FTC in order to understand the digital marketplace. Patreon is a membership platform that provides a subscription service for creators to offer their followers.

Such resources would empower the agency to place appropriate safeguards for smaller technology innovators. “So in 10 [or] 20 years, it’s not just the replacements of the current Google, Apple, or Facebook, but something entirely new,” he said.

Panelists echoed Crenshaw’s point that consumer welfare should guide competition policy. Tyler Grimm, chief counsel for policy and strategy in the House Judiciary Committee, said that antitrust should bend to the consumer welfare standard. “Antitrust should leave in its wake a better economy,” he said.

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Media Ownership

LeGeyt Appointed President and CEO of National Association of Broadcasters

LeGeyt was the organization’s executive vice president of government relations and COO.

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Curtis LeGeyt

WASHINGTON, January 4, 2022 – The National Association of Broadcasters has appointed Curtis LeGeyt to serve as president and CEO, replacing Gordon Smith.

“It is an honor to lead this great organization and advocate for the local television and radio broadcasters that inform, entertain and serve their communities every day,” said LeGeyt in a statement. “I am grateful to our Board of Directors for placing its trust in me and look forward to working alongside them, the entire NAB team and our members to ensure a vibrant future for broadcasting.”

LeGeyt was previously the executive vice president of government relations and chief operating officer of NAB. He holds a JD from Cornell Law School.

“We are excited to now have Curtis at the helm to guide the organization into its next chapter. He is a proven leader and skilled fighter on behalf of broadcasters, and we are thrilled to have him serve as our voice in Washington and around the world,” said David Santrella, NAB joint board of directors chairman and CEO of Salem Media Group.

The previous president and CEO, Gordon Smith, served in this role for 12 years. Smith will remain with the NAB, albeit in an “advisory and advocacy” capacity. During his tenure, NAB took a hardline on big technology companies, condemning them as a threat to small TV and radio stations that make up local media, and called for citizens to voice their concerns to legislators.

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