Is Antitrust Scrutiny Worrying Big Tech?

Sundar Pichai, Google CEO, speaking during “An Insight, An Idea with Sundar Pichai” at the 2018 World Economic Forum in Davos, Jan. 24, 2018. | Courtesy photo by Manuel Lopez for World Economic Forum (CC BY-NC-SA 2.0)

By Terry Miller

It seems that Silicon Valley has master plan to dominate the global news market and there is increased congressional interest in keeping these tech giants at bay. The House Judiciary Committee announced in June a “top-to-bottom” antitrust investigation into digital competition issues.

Buying and selling news has never been easier, at least for Google. Google says it will pay news publishers more than $1 billion over the next three years through a new program for licensing news. This program will not be instituted in the U.S.

Google, along with Facebook, now control the lion’s share of advertising dollars that once went to publishers in the news industry. According to CNN “Paying publishers to display their content has long been a source of tension between media companies and tech platforms. Facebook struck licensing deals with news outlets including The New York Times and Dow Jones last year when it launched Facebook News.”

Google and Alphabet CEO Sundar Pichai wrote the following in a blog post announcing the investment, “The business model for newspapers—based on ads and subscription revenue—has been evolving for more than a century as audiences have turned to other sources for news, including radio, television and later, the proliferation of cable television and satellite radio. The internet has been the latest shift, and it certainly won’t be the last. Alongside other companies, governments and civic societies, we want to play our part by helping journalism in the 21st century not just survive, but thrive.”

Publications built around ads have felt obligated to Google, “leading those that have survived over the years to try to forge alternative revenue models around paid content, events and more to offset that dependency,” TechCrunch declared last Thursday.

Ironically, Pichai told his disciples in that blog post how important print journalism is: “One of the most enduring memories of my childhood is waiting for my father and grandfather to finish the paper over breakfast every morning so that I could get the latest headlines, especially in the sports section. To this day, my father still texts me whenever he sees something interesting in the news … which is a lot! I have always valued quality journalism and believed that a vibrant news industry is critical to a functioning democratic society.” 

Google’s alleged mission statement is “to organize the world’s information and make it universally accessible and useful,” Pichai wrote.

Google’s Digital Growth Program is aimed at small and medium-sized publishers to “accelerate their business growth,” Pichai continued.

Since launching the Google News Initative (GNI) in 2018, the company has learned “that the shift to digital doesn’t happen overnight. It takes months and even years of hard work to attract and develop digitally-minded talent, adopt data-driven thinking and build an audience-first culture.” Through the GNI, Google “wants to support publishers with this transition.” 

“Google has long invested in supporting news organizations as they adapt their business models in an evolving media landscape,” claims the company. But, have they invested really in themselves, aiding and abetting the quickly sinking ship that is print media?  

In a press release last year (July 23) the Department of Justice confirmed that it was “reviewing the practices of market-leading online platforms.”

In May 2019, the DOJ held a public workshop with a high-tech focus and Assistant Attorney General Makan Delrahim offered his views on these “digital gatekeepers” and the department’s approach to antitrust enforcement among tech companies. According to Arnold & Porter, “Delrahim promised to pursue enforcement against antitrust violations in the sector and offered the view that certain technology markets (such as search, social networks, operating systems, e-books, and online advertising) appear to have only one or two major competitors. He also analogized antitrust enforcement against digital sector participants to landmark monopolization cases such as Standard Oil, AT&T (1974), and Microsoft.”

Millennials may not be familiar with the massive importance of the break-up of AT&T in the 1970s, however, history does tend to repeat itself. Antitrust laws hope to prevent monopolies and promote healthy competition. According to reporting from Vox, “ A long-awaited report from top Democratic congressional lawmakers about the dominance of the four biggest tech giants had a clear message on Tuesday: Amazon, Apple, Facebook, and Google engage in a range of anti-competitive behavior, and US antitrust laws need an overhaul to allow for more competition in the US internet economy.”

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