Monopolization by News Platforms

Japan Fair Trade Commission publicized a report on the situation of relationship between the news platforms and traditional news organizations including newspapers and publishers. Recognizing the current trend in which the readers were overwhelmingly accessing various news through those platforms, the commission concluded that the use of news by the platforms could violate the anti-monopoly act, if the price for delivering news had been extremely low. Especially, Yahoo was named as the platform possibly regarded as in a superior bargaining position. JFTC’s action can be estimated as a measure for protecting democracy from the giants of information technology.

Conducted to seven major news platforms starting from last November, the research was exercised with the notion that proper supply of the news would be indispensable for progress of democracy. The commission found that 54% of consumers access the news through search engines and 34% through news portals. About 20% of consumers used Yahoo the most and Yahoo was the most major business counterpart for 60% of traditional news organizations.

 

The news platforms acquire news reports from traditional news organizations and receive advertising fee from the sponsors, which is proportional to the sum of clicks. Although the news platforms pay for the fee for using news to traditional news organizations, there have been no standard on the price setting, due to the contracts have been made individually. In the research by JFTC, the fee varied from ¥251 per a page-view to ¥49.

 

It became apparent that the news platforms earned a larger amount of money from advertisement than the fee for using news. The average of payment for using original news were only 24% of all the income from advertising. The commission indicated that the price of each news was too low to produce a fair interest for the original news providers, which could be applied to making use of “superior bargaining position” in Number 5, Sub-section 9, Article 2 of Act on Prohibition of Private Monopolization and Maintenance of Fair Trade.

 

The research by JFTC may generate the negotiation between the news platforms and traditional newspapers or publishers. It is concerned that the payment for valuable news is exploited by the platformers, causing deterioration of quality of news. Four days later from the publication of JFTC research, Yahoo announced its willingness to review the price of news, as well as disclosure of necessary data and improvement in consultation or transparency.

 

In the Western countries, new legislations for regulating the relationship between news platforms and traditional news organizations are introduced for supplying proper information to the people. Once the news reports are distorted or biased by a powerful influencers, the society may go to a wrong direction, a tendency which is seen in a nation with a populist leader. Democracy is supported by correct information.

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