House opens tech antitrust inquiry with look at news media
WASHINGTON — Congress opened its antitrust investigation of big tech Tuesday with a hearing focused on how platforms like Facebook and Google may have harmed publishers by siphoning off profits from news organizations.
Lawmakers will hear testimony from executives at News Corp, the owner of The Wall Street Journal and other publications; The Atlanta Journal-Constitution; and the News Media Alliance, a trade group representing 2,000 news organizations, including The New York Times.
Matthew Schruers, vice president of the tech trade group Computer and Communications Industry Association, will represent the tech industry.
The media executives are expected to tell members of the House Judiciary Committee, which is holding the hearing, that big tech platforms have decimated the news industry, leading to a decline in profit and the shuttering of hundreds of local newspapers around the nation.
“The rise of digital news distribution has introduced new, potentially existential threats to the news industry,” David Chavern, chief executive of the News Media Alliance, wrote in prepared testimony. “Specifically, the emergence of dominant tech platforms as intermediaries between news organizations and their audiences threatens to bring to naught the news industry’s investments in a digital future.”
Congress’ scrutiny of big tech comes amid a swell of recent events challenging the dominance of big tech. The Justice Department and the Federal Trade Commission, the two top antitrust agencies, recently divided oversight over Apple, Amazon, Facebook, and Google, increasing scrutiny of the tech giants and how their businesses may be harming rivals and consumers. European regulators have already taken a tough stance against the titans of Silicon Valley, investigating companies for how they handle user data, police speech, and limit competition.
The House committee plans several hearings, depositions, and interviews with competitors over the next 18 months as part of its investigation into whether the dominance and power of Amazon, Apple, Facebook, and Google have decreased competition and harmed consumers.
Representative David Cicilline, a Rhode Island Democrat, is leading the Judiciary Committee’s investigation into big tech. Cicilline has said it would explore a diverse range of issues related to the industry. He said the committee would look into whether the dominant social network, Facebook, had harmed consumers with its handling of data, for example. He said it also planned to look into whether Amazon had harmed smaller retailers.
Tuesday’s hearing will give publishers a platform after years of complaining about big tech platforms. The News Media Alliance has long argued that Facebook and Google have become the biggest online advertising companies at the expense of publishers, which now rely on the platforms to find audiences.
Rupert Murdoch, who controls News Corp, has been one of the longest and most prominent critics of Google and Facebook. In 2011, he warned at a workshop at the Federal Trade Commission that Google’s aggregation of news content would significantly harm the industry.
“To be impolite, that is theft,” Murdoch said at the time.
The hearing is expected to focus in part on a bill introduced by Cicilline and Representative Doug Collins, Republican of Georgia, that would give publishers the ability to jointly negotiate with Google, Facebook, and other platforms for better terms. The law would exempt the publishers from antitrust rules for four years, protecting publishers from charges of price collusion.
Cicilline said in his opening remarks that 2,900 reporters and other news staff had lost their jobs this year and that news ad revenue had dropped to $15.6 billion in 2017 from $49 billion in 2006.
“Concentration in the digital advertising market has pushed local journalism to the verge of extinction,” Cicilline said.