America's Free Press and Monopoly
In this report, Open Markets Institute explores the historical role of competition policy in protecting independent journalism in America.
The Internet has revolutionized how people communicate, making it vastly easier than ever before to connect within a community and across the world. But the wholesale shift of communications to the Internet has also unleashed a variety of challenges to existing institutional structures in the United States. Perhaps the most dramatic of these is the sudden sharp erosion in the independence and trustworthiness of our journalism and much of the information packaged as journalism. This is among the most serious and pressing challenges to democracy and to civil and political liberty in our time.
Over the last year, two problems have exploded into public debate. First was the realization that political actors abroad and in the United States had figured out how to exploit the Internet to distribute propaganda and misinformation – popularly called “fake news” – in ways that disrupted our electoral systems and our politics. Second was the realization that the advertising-dependent business models of corporations like Facebook and Google are based on an intimate surveillance of the actions and communications of hundreds of millions of individuals, and on the centralized storage and manipulation of this information.
But Americans also face a more subtle and slow-moving third problem that in many respects poses even greater dangers to American democracy and to the most fundamental liberties of the individual. This is the concentration of power over reporters and news publishers by giant “platform monopolists.” These private corporations simultaneously have centralized control over the flow of information and news between reporters and readers, and diverted advertising revenue away from both traditional and Internet “native” publishers, at both the national and local levels, into their own coffers.
Wired Editor-in-Chief Nicholas Thompson and Fred Vogelstein recently published what may be the most concise description of today’s relationship between reporters and publishers and the platform monopolists, a relationship characterized increasingly by dependence, exploitation, and fear.
“Every publisher knows that, at best, they are sharecroppers on Facebook’s massive industrial farm... And journalists know that the man who owns the farm has the leverage. If Facebook wanted to, it could quietly turn any number of dials that would harm a publisher – by manipulating its traffic, its ad network, or its readers.”
The same is equally true of Google. As Jim VandeHei of Axios wrote recently, “The media is obsessed with Facebook.” But publishers and reporters are “exponentially more dependent on Google.” The corporation, he wrote “is a gigantic octopus, with sprawling, growing tentacles reaching deep into every nook and crevice of media companies.”
To complicate matters, Americans are engaged in a fast-growing debate over whether anyone should censor content on the Internet. And if the answer is yes, whether it would be wise to use Google and Facebook to do so. We saw this most dramatically in the recent debate over Congress’s passage of the FOSTA–SESTA (Fight Online Sex Trafficking Act, Stop Enabling Sex Traffickers Act) bill to fight sex trafficking online.
To speed the discussion of how to address these extremely pressing and vitally important challenges, the Open Markets Institute and the Tow Center at Columbia School of Journalism convened a wide-ranging conference in Washington, on June 12, 2018. The immediate goal of the event was to better understand the nature, scope, and sources of the threat to America’s free press and to the American right of free expression. This includes beginning to answer two questions. First, to what degree are the privacy and “fake news” scandals a result of the ways in which Facebook and Google have monopolized control over communications flows in America? And second, to what degree are Google and Facebook’s monopolies responsible for the decline in trustworthy journalism?
The second, equally important goal of this conference is to help citizens understand that Americans have faced similar challenges before, with the rise of then-revolutionary new technologies such as the telegraph in the 19th century and of radio and television in the 20th Century. In each instance, we used government to ensure the independence and financial viability of the news media. Over the course of more than two centuries, Americans developed many regulatory and policy tools that can be of use to us today.
The purpose of this discussion paper is to reconnect us, at least briefly, with that past, to help us determine which tools to use to address today’s challenges. What the paper shows, we believe, is that the history of American journalism is one of ceaseless private initiative and innovation, as individual citizens strive to figure out better ways and smarter business models to a) keep a check on government and private power, b) inform citizens, and specific communities within society, of the basic events and challenges of the day, and c) pay the costs of reporting, editing, and distributing the news.
What this discussion paper also shows is that, from even before the Declaration of Independence, Americans used government both to promote the building of technologically sophisticated infrastructures to distribute the news, and to directly address threats to the free press posed by either private monopolists or by government actors.
Read the full report here: America's Free Press and Monopoly PDF