Time is ticking on a fascinatingly divisive piece of tech legislation moving through Congress—and Meta is making a final push to run out the clock.
The tech giant threatened Monday to pull news stories from its Facebook platform if Congress passes the Journalism Competition and Preservation Act, a bill that would essentially force Meta and Google parent Alphabet to share ad revenues with most media publishers. Meta’s warning came as various reports emerged that the JCPA might get attached to a piece of national defense legislation that must pass before the end of the year.
“If Congress passes an ill-considered journalism bill as part of national security legislation, we will be forced to consider removing news from our platform altogether rather than submit to government mandated negotiations that unfairly disregard any value we provide to news outlets through increased traffic and subscriptions,” Meta officials said in a statement.
The pronouncement further reinforces perceptions of Meta as the greedy bully of the block, using its immense power to coerce and cajole legislators into upholding an advertising duopoly. Meta briefly made good on a similar threat in Australia last year as policymakers considered a similar bill, but ultimately relented after extracting favorable legislative concessions.
But setting aside Meta’s brazen lobbying, it’s worth examining the merits of a government proposal that could transfer hundreds of millions of dollars from Big Tech to the mainstream media.
The JCPA’s bipartisan backers are honorably trying to tackle a civic crisis: the slow decay of the local news industry. According to the Pew Research Center, the number of employees working in U.S. print, digital, television, and radio newsrooms fell 26% between 2008 and 2020. Newspapers have been particularly decimated, with employment falling from about 71,000 to 31,000 during that time.
The reasons for the decline are numerous. Trust in the media has plummeted. Fewer people are willing to pay for news. Subscription rates keep rising. Digital ads generate less revenue than print ads. Craiglist destroyed newspapers’ classified ad business.
A major contributor, however, has been the emergence of Facebook and Google as the dominant advertising platforms. The two tech giants suck up most digital ad revenues through their market supremacy and lucrative ad-tech platforms, leaving a small percentage of the pie for publishers.
Rather than tackling a sweeping overhaul of U.S. antitrust code, Congress decided this year to push through the JCPA, a narrowly tailored exemption to existing law. The legislation, which mirrors the law ultimately enacted in Australia last year, would allow nearly all newspaper publishers and all television stations to negotiate with Google and Facebook for a cut of digital ad revenues generated by news articles hosted on their platforms. Disputes would go before an independent arbiter.
The bill advanced out of the Senate Judiciary Committee in September on a 15-7 vote, and it boasts the backing of the News/Media Alliance, the industry’s leading advocacy group.
“The tech giants have built their empires by profiting off the hard work of journalists without fairly compensating them,” the News/Media Alliance wrote last month. “And as local publications struggle to stay afloat, Big Tech has only doubled down on their anticompetitive practices, further consolidating their control over the flow of information. This is fundamentally unfair, and the JCPA will bring about much-needed change.”
Yet a strange collection of anti-JCPA bedfellows has emerged in recent months, offering several critiques of the legislation. The opponents include anti-Big Tech nonprofits, civil liberties champions, free-market devotees, newspaper unions, small publishers, and mainstream media antagonists on the political right.
Some of the criticism stems from fears that the JCPA sets a poor precedent for the digital ecosystem, fails to address larger antitrust issues, and injects the government into complex business matters.
Another critique centers on the beneficiaries of any JCPA-related revenue. Some labor advocates and independent publishers worry that major media organizations—including publicly traded companies and hedge funds that own outlets—would serve corporate interests ahead of the public good.
“We have no confidence that these massively consolidated publishers will use whatever revenues they collect from JCPA to invest in journalists rather than more mergers, stock buybacks, overpaid executives and union-busting lawyers—because that’s how these companies spend the revenues that they already extract from our members’ journalism,” the leaders of 15 news guilds wrote in September.
We’ll see whether Meta makes good on its promise should the JCPA become law. Monday’s statement certainly makes clear that it’s increasingly nervous about that prospect.
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Jacob Carpenter
