REPORT: Facebook And Google Might Be Forced To Pay News Publishers

(PatriotWise.com)- The United States government isn’t the only one that has its eyes set on tech giants. The UK is getting in on the act, too.

The UK government’s digital taskforce announced this week that they may try to rein in the powers of Facebook and Google by forcing the two tech companies to pay publishers for the use of their news content.

The UK competitions watchdog is leading a group that says it believes UK’s publishers have been victimized by the market dominance of both Google and Facebook. One way to address this issue is to pay the British publishers for videos and stories that are used by and posted on their sites.

The recommendations from the UK digital taskforce also say the company’s grip over the digital advertising market need to be looked into. The taskforce said the companies use “shadowy algorithms” that have resulted in them accounting for 80% of the digital advertising market in the UK, which totals roughly £14 billion.

At the same time, traditional media organizations and news outlets are struggling with digital ad revenue. They’ve seen their sales from this form of advertising drop significantly while Google and Facebook have seen theirs skyrocket.

In March, the UK government commissioned what it calls the Digital Markets Taskforce to look into this situation. From it, they issued these recommendations. The taskforce worked with the Information Commissioner’s Office, the Financial Conduct Authority, Ofcom, and other experts from the Competition and Markets Authority.

One recommendation the taskforce made was setting up a regulator of this digital activity. They want to call it the Digital Markets Unit and have it in place by April. The goal of that unit would be to create a code of conduct that would be legally enforceable.

It would also have the power to issue fines of up to 10% of global turnover. In essence, Google could get a penalty of £12 billion and Facebook £5 billion of they were to break any of the rules set up. Essentially, the rules would be set up to deter the companies from engaging in behavior that would be termed anti-competitive.

This recommendation from the taskforce aligns with rules that are set to be imposed by the Australian Competition and Consumer Commissioner. That agency said the tech companies have to pay for any news content that is generated by the media in Australia.

In addition to policing the general behaviors of the tech firms, and forcing them to pay for news content, the rules are designed to lay out how the companies should do business with other companies, as well as how they treat users on their sites. Stricter regulations on company mergers would be imposed, too, to prevent against additional harm to consumers.

The DMU would ultimately decide how to define each of the rules, how they’ll be enforced, etc. Any major changes the agency would recommend — such as breaking up or separating the businesses’ platforms — would need to go through the CMA in order to be passed into law.