WASHINGTON – Sen. Maria Cantwell, the top Democrat on the Senate Commerce Committee, released a report Tuesday detailing the threats posed to local journalism by tech companies, a day before the CEOs of Facebook, Twitter and Google are set to testify before the committee.
The report takes aim at “unfair market practices by some of the world’s largest technology companies” that have further undermined a sector that has struggled to transition to the digital age. Its authors, led by the veteran Washington lawmaker, call for Congress to give federal regulators greater authority to protect the local news industry.
Cantwell said the report is the result of six months of work by the committee’s Democratic staff and years she has spent tracking media consolidation and pressures on local news outlets that have grown with the rise of Silicon Valley giants like Facebook and Google.
“As we started to see the drastic impacts over the past few years,” she said, “we became concerned that we were losing a key element of what is so important in our country, really an engine of making more accurate information as it relates to our economy, our communities and the oversight of government.”
The report raises alarm about revenue losses of about 70% for local newspapers and 40% for local broadcasters over the past two decades, turning 200 counties across the country into “news deserts” with no newspapers covering them. Despite those dire figures, a 2019 Pew Research Center survey points to a disconnect, with 71% of Americans believing their local outlets are “doing well financially.”
The report cites a 2019 study by the Knight Foundation and the polling firm Gallup that found two-thirds of Americans trust local news over national media to “report the news without bias,” with nearly four out of five people saying local outlets are better at delivering news they can use in their daily lives. But more than 40,000 newsroom workers have lost their jobs in the past 20 years, the report finds, depriving communities of “trusted, non-partisan information that keeps our civil institutions cohesive and resilient.”
“News media, just like other media, are going through a transformation to the digital age,” Cantwell said. “In that transformation, it drastically changed the price of advertising. Local news is trying to adjust to that (and) while they’re making this transition into very disruptive, hard economic times, you also have unfair practices by a concentration of power online.”
That online power, the report alleges, has been concentrated in the hands of news aggregation platforms, especially Google and Facebook, which use local news stories to generate ad revenue for themselves and use their dominance in the market to strong-arm local news outlets into handing over their content for pennies on the dollar.
Those practices may violate state and federal antitrust laws, and the report says attorneys general from 48 states, plus Puerto Rico and Washington, D.C., have begun investigating Google for maintaining illegal monopolies.
The report’s authors, however, express concern that existing U.S. anti-monopoly laws have evolved to become too narrow to address the tech companies’ behavior and recommend Congress give the Federal Trade Commission – the agency charged with consumer protection and enforcing antitrust laws – “new or expanded authorities” to counter unfair practices by tech platforms.
“Congress needs to work to give the FTC power to address those unfair competitive practices,” Cantwell said. “We think it’s important to have some tools – a policeman on the beat – to make sure that there is a level playing field.”
Cantwell declined to tip her hand and say how she plans to grill the tech executives Wednesday, but said she intends to focus on their companies’ impact on local news. Republicans on the committee, meanwhile, are expected to focus on a decades-old internet governance statute that shields tech companies from liability for content on their platforms – or for removing it.
Both parties have concerns with the law, Section 230 of the Communications Decency Act of 1996, but GOP lawmakers have seized on its role in Twitter and Facebook’s recent moves to slow the spread on their platforms of a questionably sourced New York Post story on former Vice President Joe Biden’s son.
The hearing will take place Wednesday morning, with Google CEO Sundar Pichai, Twitter CEO Jack Dorsey and Facebook CEO Mark Zuckerberg joining Cantwell and the other committee members remotely.
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