The Google-Facebook duopoly shamefully tries to extort Canadians By threatening to remove news from their platforms, the tech giants only want to maintain their uncompetitive practices

[Nat Quinn]

More than 80 per cent of ad revenues in Canada go to Google and Facebook. Much of that ad revenue is generated from news distributed on their platforms, created by news publishers, including Postmedia. The tech giants didn’t gain this market share through innovation, but through uncompetitive practices.

Beginning in 2005 with its acquisition of ad server DoubleClick, Google began gaining increasing control of the financial market that connects sellers and buyers of online ads. Not only does Google receive the lion’s share of revenue from selling ad space, it also gets paid on the buy side because it owns the ad-serving infrastructure itself. It uses this power to manipulate the market and keep competitors, specifically publishers of news, from gaining too much of a foothold.

Join the conversation

Have your sayLeave a comment and share your thoughts with our community.

 

Google also conspired with Facebook, the biggest threat to Google’s ad dominance, to give it preferential treatment under the so-called Jedi-Blue deal in order “to manipulate advertising auctions,” according to a U.S. antitrust lawsuit.

 

This predatory behaviour is very likely unlawful and clearly shows that Google and Facebook aren’t just benefiting from having developed a better product. Those wanting to purchase ads have little choice but to go through Google’s infrastructure. Meanwhile, Facebook and Google advertise to readers by serving up news articles published by media organizations who get none of the ad revenue.

 

The Online News Act helps rebalance the playing field so news publishers can get on with the business of journalism.

 

For decades, news companies have relied on advertising sales to fund their newsgathering operations. Publishers have to compete both for advertising clients, as well as for news readers and subscribers.

 

On the editorial side, where there is no monopoly, publishers compete energetically, aggressively and healthily, despite the increasingly toxic narrative that this industry is somehow unwilling to adapt to the digital age. There are more news organizations, new and old, delivering more news than ever before.

 

The transition from print and television news to digital publishing has rarely been smooth, as Canadian news companies face intense competition not only from each other but from American properties, as the internet gave readers access to news from anywhere almost instantly.

 

And yet, for a quarter century, news publishers, especially established brands like the National Post, have continued to provide readers valuable and important journalism. News companies are perhaps not as large as they were in the pre-internet era, but there is hardly a dearth of news or a lack of innovation.

 

Across Postmedia brands, we continue to attract readers by the millions, producing coverage that our readers want, trust and are increasingly willing to pay for.

We are confident we are up to the challenge, even when considering the existence of a hostile government policy of increased funding for the CBC, which competes with the work of the private news media, but gives its news away for free. The federal government also maintains onerous regulations on news broadcasters through the CRTC.

This is not an industry in crisis because of its own failures, but rather because a global monopoly in digital ad sales was allowed to emerge by governments asleep at the switch. The federal government has good reason to stand firm and not give in to the tech giants.

National Post

[Author]

Posts