The following editorial is from the Los Angeles Times.
The internet has been an enormous blessing to many industries. The newspaper business is not one of them.
Granted, daily newspaper readership started declining well before British computer scientist Tim Berners Lee invented the World Wide Web. But the damage was compounded as dial-up modems gave way to always-on broadband connections and advertisers flocked to new online channels that could target their pitches to the consumers most likely to respond.
That’s why a growing number of democracies are looking for ways to shore up local news outlets, which have long played a key role in scrutinizing elected officials and their policies, uncovering waste and fraud, and holding local governments accountable to the public. In particular, they’ve looked to tap the staggering online advertising fortunes amassed by Google and Facebook, two global powerhouses that have become major outlets of news online — much of it reported and written by newspapers. Those companies are in lawmakers’ sights also because of the control they exert over online advertising technology and their ability to collect data about internet users, including the ones on newspapers’ own sites.
The latest government to take on this issue is Australia’s, which is poised to require Google and Facebook to negotiate with news companies — individually or collectively — for the right to publish links to or snippets of their stories. The proposal echoes similar measures that have been enacted in Europe and are being floated in the United States and Canada.
The legislation drew two noteworthy responses as it moved toward final approval last week. Google struck a deal with News Corp. — the global empire of Australian-turned-American news titan Rupert Murdoch, whose portfolio includes eight of Australia’s 10 most widely read newspapers — that will pay what News Corp. called a “significant” amount for the use of its stories in Google News Showcase, a feature on one of Google’s smartphone apps. And Facebook yanked all the news articles by Australian media from its network — even the ones posted by the news companies themselves.
Facebook’s censorship was so ham-handed, it also knocked out posts from government agencies, nonprofits and public services. Maybe that’s not surprising, given how inept the social media giant has been at removing fake news from its pages. Some critics speculated, though, that the excessive takedowns were deliberate, designed to show that the law would hurt more than just news companies. (For its part, Facebook insisted that it had not intended such a broad sweep, and it pledged to restore some of the blocked content.)
The blackout recalled Google’s threat to remove Google News — a service that aggregates news headlines, descriptions and headlines — from Spain and Germany after those countries enacted laws requiring publishers to be paid for such uses. Google ultimately restored the service in Germany for publishers that waived the fees, which many did after seeing their traffic plummet, but terminated Google News in Spain, pushing down online readership at Spanish news sites, especially smaller outlets.
The lesson there is twofold: News publishers do get some benefit when Google and Facebook post links to their stories, although a portion of the readership stops with the headlines and never clicks through to the articles. And the smaller the publisher, the more dependent it is on Google and Facebook for online traffic.
Therein lies one problem with Australia’s approach. The goal of the legislation is to correct what the Australian Competition and Consumer Commission describes as a “fundamental bargaining power imbalance between Australian news media businesses and major digital platforms.” But simply requiring a negotiation and binding arbitration doesn’t help a small local news outlet extract the kind of terms that News Corp. can for the use of its content. In fact, the Australian bill excludes publishers that are new, that have minimal revenue (so much for solo journalistic crusaders) and that do not publish what the Australian government regards as “core” news.
Keeping the flame of local journalism alive is vital to democracy, but it’s no simple matter for governments to do so effectively. As they seek to help the news organizations struggling to make the transition to the broadband era, they need to take care not to simply shift dollars from one big bank account to another, or to impede the abilities to link to and quote from published material that are so important to the free flow of information online. Any solution needs to be transparent and predictable as well, and not a blow to journalistic independence.
There are a number of promising alternative routes to that destination — for example, advocacy groups Public Knowledge and Free Press have proposed ways to fund local journalism through user fees or taxes, respectively, on the largest advertising-based businesses online. But with seemingly each week bringing news of another local news outlet shutting down or being sucked into a soulless, cost-cutting corporate machine, lawmakers are running out of time to make a difference.