
News Outlets to Seek Bargaining Rights Against Google and Facebook - panarky
https://www.nytimes.com/2017/07/09/business/media/google-facebook-news-media-alliance.html
======
panarky
Markets for widgets generally work pretty well. The consumer pays the
distributor and the distributor pays the producer. When consumer preferences
change, the supply chain produces more or less widgets with higher or lower
quality.

But markets for information are leaky. Consumers can get information without
paying the distributor. Many consumers can't tell the difference between high-
quality information and information that's deceptive or manipulative. Most
consumers aren't willing to pay for high-quality information.

So markets for information don't work as well as markets for widgets.
Producers don't get paid, the supply of quality information is diminished, and
we are all poorer as a result.

Now the producers want to form a cartel to negotiate with distributors as a
bloc. But this only increases the cost of content to the distributor.

A cartel doesn't fix the root cause. Consumers still don't want to pay.
Increasing the cost without changing consumers' willingness to pay will only
make a bad situation even worse.

At a higher cost, even less high-quality information will be demanded, so even
less will be produced. Producers will shrink further into irrelevance, low-
quality information will dominate, and we'll all be even poorer.

When consumers aren't willing to pay, markets don't work well.

It's unlikely consumers will suddenly become willing to pay for information
they can get for free, so feeds will fill up with even more low-quality,
deceptive and manipulative information.

Maybe markets just aren't the right mechanism. Since the public needs high-
quality information now more than ever, maybe we need to examine non-market
methods to produce it.

~~~
TheGirondin
I would gladly subscribe to an NPR-caliber newspaper that doesn't have pushing
liberal narratives as a #1 priority.

Just like Fox is #1 because it's the only not-liberal media outlet, a real
not-liberal newspaper would have a huge following because of the lack of
alternatives.

~~~
jerrylives
>a real not-liberal newspaper would have a huge following because of the lack
of alternative

Like uh The Wall Street Journal? Lol.

And what do you do if your preferred media posts what may be construed as a
liberal headline? Just unsubscribe immediately? Snowflake, much?

~~~
TheGirondin
>And what do you do if your preferred media posts what may be construed as a
[opposing viewpoint] headline? Just unsubscribe immediately?

No, because I'm not fragile like liberals are.

------
sparkzilla
Real title: Failing news outlets seek government protection for past failures
and outdated business models.

The legacy news media has completely failed to understand two things 1) that
distribution is king, not content and 2) that their potential customers have
so many more options now than just news. They gave away their distribution to
Google and Facebook and still think that better content is the driver of their
businesses. I am sick of hearing the CEO of News Corp whining about Google and
Facebook. They could easily have invested in creating their own alternative
distribution networks, but they completely blew the opportunity they had, with
MySpace and they could have bought Instagram, What's App, SnapChat (if you
don't think these are news networks then you've not been paying attention). So
now they go whining to the government? Shame on them.

~~~
ocdtrekkie
Eh, I disagree. Content is still king, and the sources of good, quality
content is still limited. The problem is that Google and Facebook are more
than willing to steal that content, and are too large for anyone to fight.

If cornered on it with laws like the Spanish link tax, they're more than happy
to just leave until the business situation is more favorable to them, and
obviously if any given single provider bans Google's collection, Google can
simply post from one of the litany of blogs that reposts other journalists'
reporting instead.

~~~
sparkzilla
Thinking that 'content is king' is how newspapers got into this situation. If
you have large distribution (Facebook), even if it is pictures of cats, you
can make money and then buy "quality" content, which is a niche. If you lose
control of distribution (Legacy news) you can't make money and you can't make
any content, no matter how good it is.

>The problem is that Google and Facebook are more than willing to steal that
content

Really? While Facebook was letting people copy video content from Facebook
with no penalty (freebooting), this was never an issue for the news companies.
As for the Spanish situation, the news companies gave in because they realised
that without Google they had even less distribution than before.

~~~
ocdtrekkie
That's the whole reason news companies are asking for an antitrust
consideration: Google can hurt them massively by simply walking away from the
negotiating table. Either they give up their content for free or Google drops
them, and they hurt even worse.

Obviously for the news agencies, their hope would be that Google be somehow
forced to pay them for access and not be allowed to shut down the service. Of
course, it's hard to imagine how the government could require Google News to
operate as a service.

The thing that's broken here is that in any other content situation like
movies or music, the content is unique and copyrighted. If you want Katy Perry
or Star Wars, you have to deal with the companies with rights to those, and
the MPAA and RIAA are formidable industry associations which can swing a lot
of weight and force a negotiation. If you want any "music" at all, really, you
have to sit down with the RIAA.

News, however, can't really be copyrighted that way, since fact can be
restated by anyone. It's fair use. In a traditional situation, all the
affected corporations (like every major news org) would band together and set
the bar for negotiation. Someone like Google would have to comply or lose out
on a lot of information to base their services on. However, in the case of
news, Google has an infinite amount of blogspam to feed off of that is
cannibalizing and resharing the news from journalists. Google wouldn't be hurt
enough by news agencies blocking them, at least, compared to how much it would
hurt news agencies to not be distributed by them.

~~~
sparkzilla
>Either they give up their content for free or Google drops them, and they
hurt even worse.

They haven't give up their content to Google/Facebook; they give up their
distribution. Links to news sites on Google and Facebook are a form of
distribution that link back to the original article. As for antitrust, that's
somewhat difficult to argue when a new entrant (Facebook) is currently taking
a massive amount of distribution and ad revenue away from Google. Who's to say
that another new entrant, funded by the legacy news industry, couldn't do the
same?

The legacy news media should have, and still should, focus on making or buying
new distribution channels. Instead of whining to the government, they should
compete in the market.

~~~
ocdtrekkie
Arguably, between AMP and Instant Articles, the original articles don't really
count as "in play" anymore.

I doubt news is as easy to enter as you imagine. Google and Facebook are in it
due to their dominance in search and social respectively. Both are arguably
monopolies in their respective fields, and news distribution runs secondary to
that.

I see where they're coming from, but it's also hard to imagine a legal
framework that supports what they'd like to have here in the US.

------
SirensOfTitan
All of these media companies saw changes for decades? around distribution
occurring and seemingly did nothing about it. Even now, as better distribution
models are making their businesses obsolete, they refuse to innovate and seek
legal protections instead.

I don't have much sympathy here. The history is revisionist: these companies
used to be powerful actors who now find their businesses evaporating. And many
of them had a big hand in the rise of fake news themselves. They're all
apparently blameless in both scenarios.

------
phkahler
"that once paid for the quality journalism that Google and Facebook now offer
for free."

What? I have yet to see Facebook offer "journalism" of pretty much any kind.

~~~
trendia
They're saying:

NYTimes is quality journalism. People used to pay for the NYTimes.

Now Google and Facebook offer the news from NYTimes for free.

~~~
phkahler
>> Now Google and Facebook offer the news from NYTimes for free.

But they don't. They offer links to the NYTimes. Well, actually they probably
get paid to offer links to the NYTimes.

------
iamben
It was what, 7 or so years ago that Rupert Murdoch was threatening to remove
all links and content from Google, and News Corp were saying:

"The traffic which comes in from Google brings a consumer who more often than
not read one article and then leaves the site. That is the least valuable of
traffic to us… the economic impact [of not having content indexed by Google]
is not as great as you might think. You can survive without it."

Oh how times change. Another example of a situation where a little bit of
forward thinking, rather than clinging to an established model with a
blinkered attitude, would have gone a long way.

~~~
panarky
It's curious that the publishers' trade group lobbying Congress to allow them
to form a cartel made their argument in a Wall Street Journal editorial.

"How Antitrust Undermines Press Freedom" [https://www.wsj.com/articles/how-
antitrust-undermines-press-...](https://www.wsj.com/articles/how-antitrust-
undermines-press-freedom-1499638532)

Since the WSJ is paywalled the public can't even read their argument.

What's the rationale here? Does paywalling their argument get more subscribers
for the WSJ? Or does it intentionally limit visibility to elites likely to
have a subscription while keeping the public in the dark?

------
AznHisoka
"it is impossible for us to go as a one-off company and negotiate or even get
an appointment with these companies.”

boohoo. cry me a river. this sounds so entitled. Like the Big Banks who cried
for a bailout during the Financial Crisis in 2008. "i deserve help because I
make lots of money"

~~~
Spivak
It's interesting to see that apparently only now do news organizations now
realize who their real masters are.

Did they not see the writing on the wall when their analytics showed almost
all of their traffic originating from Google and Facebook?

~~~
untog
Of course they did. But what can you do when Google and Facebook command
almost all of the traffic on the internet?

------
carlmungz
Speaking as an ex-journalist, I think the battle has already been lost because
the distribution platforms will always make more money than the content
producers. Even when I was a journalist I rarely bought physical
newspapers/magazines or had any subscriptions because I consumed things on
story by story basis from different publications.

I worked in local news and I think there's probably more hope for smaller,
nimble outfits which combine tech and news well to survive. Depending on your
geographical location, I think you can provide enough local value to sustain <
10 staff. But then that requires having access to engineers willing to work in
such an operation.

------
losteverything
Ultimately, what do they want? (assume they can bargain together)

~~~
hardtke
They likely want to implement a pay to link scheme for news articles. This
would be similar to the way that every songwriter gets a small royalty when
their song is played on the radio or on a streaming service. In the case of
the songwriters, it is government sanctioned and therefore not an illegal
cartel.

~~~
AznHisoka
and this is how I would react if I was Google:

"awesome, ok.. so you know what? you win. you are right. we shouldnt link to
you without paying you anything. So instead of paying you we've decided to
remove all your links from our index. happy? no? but thats what you wanted!
no..? ok i am confused.. what do you want?.. wait you want free money? ok....
then"

------
randomerr
The New York Times has been fighting against anything Google for their
advertising network and Facebook for offering alternative news services. With
the change of Google News demoting NYT stories this maybe their last chance at
being viable as a national news source. Maybe if the NYT would get rid of that
paywall they get more readers and relinkers.

~~~
jerrylives
The New York Times is severely fucked even without Google messing with their
rankings.

They still make most of their money from dead tree newspaper subscribers who
are almost all over 50 but are losing those subscribers at a massive rate.
There is an internal initiative to basically double digital revenue by 2020 to
make up for the losses on the paper side but, speaking as someone who worked
there, it's not looking good. At all. They brag about how they just got 40k
new digital subscribers in the month after Trump got elected but a lot of
those are subsidized / deal subs and won't be sticking around in the long
term.

It also doesn't help that the NYT continually downsizes its newsroom and
editorial staff to make ill-informed forays into tech (The NYT digital r&d
department was a complete joke - like they paid 5 engineers high six figure
salaries to basically jerk off and put a monitor behind a mirror - oh wow so
innovative).

Most of the bloat at the NYT is absolutely in the tech department but they
rarely fire anyone there (I quit). They have big teams supporting legacy
systems that are used by maybe a hundred people a month. They have an entire
lexical / semantic team with a "sophisticated" (re: expensive, old, and
clunky) tagging system that does essentially nothing for the NYT, because
guess how many people use their "topic" knowledge base (e.g.
[https://www.nytimes.com/topic/person/hillary-rodham-
clinton](https://www.nytimes.com/topic/person/hillary-rodham-clinton))? I'll
give you a hint: more than zero, but not by much. But there's like four or
five full time engineers with six figure salaries supporting it.

