Why the Media Wants Big Tech to Pay

IT Minister Rajeev Chandrashekhar said the government was reviewing the power of big tech companies over digital advertising, sparking speculation that India may seek to regulate its dealings with news publishers. What could be the way forward? Mint explains:

Is this the first time this has happened?

No. Earlier this year, the Digital News Publishers Association (DNPA) and Indian Newspaper Society (INS) approached India’s Competition Commission (ICC), accusing Google of abusing its dominant market position. In March, the anti-trust authority decided to close the two allegations and ordered an investigation into the matter against Google. INS had written a letter to Google in February last year, asking the tech giant to compensate newspapers for the use of content they publish on its platform. He was also looking for a bigger share of online ad revenue.

Why do publishers clash with Big Tech?

Publishers around the world are faced with business models facing digital disruption. The bone of contention is twofold. The first is that tech giants such as Google and Facebook serve publisher-owned content to their News Feed and Pages and directly or indirectly monetize the resulting traffic, while the publisher who incurred the cost generation of this content gets a low or insufficient share. The second is that big tech has so cornered digital advertising (more than 90% market share in most markets) that it wields unfair pricing power and other scale advantages that disadvantage publishers.

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Is India the only one to consider such brakes?

Australia’s News Media Code of Negotiation, adopted last year, is widely regarded as the model for regulating relations between the news media and big tech. This forces companies like Google to pay publishers to display links on their platforms. Google also allowed content from publishers in Europe earlier this year, under the EU copyright directive.

Are Indian laws capable of solving the problem?

The IT law is not particularly equipped to deal with such issues, experts said. They said the Digital India Bill – essentially an amendment to the IT Act – would likely be the one to regulate the Big Tech-News relationship. Additionally, CCI probes could also help regulate the market if it sees evidence that Big Tech is predatory on publishers. The Central Consumer Protection Authority, created in 2019, could also seek to regulate the relationship between platforms and Big Tech.

What steps has Big Tech taken?

Big Tech has already taken steps to license content from publishers. Google announced an initiative called News Showcase in 2020 and allowed content from publishers around the world including India under this initiative. After initially resisting Australian laws, Facebook finally decided to comply with the law. While these laws work in favor of big news publishers, experts have noted they can be crippling for smaller news houses, or can lose access to platforms if they choose not to license their content.

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