In a landmark move, the Competition Commission of South Africa has initiated an extensive 15-month investigation into the practices of dominant digital platforms like Meta and Google, examining their use of news content to boost advertising revenue.
The Media and Digital Platforms Market Inquiry (MDPMI) is set to look at market competition, the algorithms’ role as gatekeepers, and the implications for news media organisations in light of the rapid transition to digital news consumption.
There is already global unease over the decline of traditional news media’s advertising income. In June, the Canadian Parliament passed a law requiring tech companies to pay domestic news outlets for linking to their articles. Facebook subsequently enacted an all-out news link ban in Canada.
New age
In the same month, the largest newspaper chain in the US sued Google for monopoly of online ads.
The global ad marketplace for print media has been cut in half in the last six years. With advertisers moving online where aggregator sites, social media and video platforms have user’s attention.
In this new age, AI-driven algorithms dictate content visibility, influencing consumer traffic and the subsequent distribution of ad revenue — a matter the MDPMI seeks to address.
The prevalence of online platforms has not only shifted readership but has also raised questions about the fairness of how advertising profits are shared.
Healthy press
“As the media landscape evolves, ensuring equitable access to ad revenue is essential for maintaining a healthy press,” said Joe Hamman, director at Novus Group Media Monitoring. “This inquiry could pave the way for more sustainable media funding models.”
Furthermore, the quality and diversity of news is at stake. There’s a worrying trend towards clickbait as news outlets compete for clicks. This can undermine in-depth reporting and investigative journalism.
“The revenue system currently prioritises user engagement at the expense of facts. This can lead to lower news quality, and sometimes even promoting the spread of fake news,” notes Hamman.
The investigation is expected to probe the bargaining power between news creators and digital giants. Platforms that aggregate news have changed how content is accessed and valued, with their algorithms playing a significant role in what news consumers see.
Referral traffic
These platforms’ influence on referral traffic to news websites is also a key concern, potentially affecting how newsrooms are funded and operate.
South Africa’s inquiry aligns with a wave of international scrutiny and regulatory measures, mirroring the European Union’s recent efforts to regulate digital markets.
“It’s a critical juncture for the media industry,” Hamman said. “The findings and recommendations of the Commission could incite necessary changes to protect the integrity and viability of news media for years to come.”
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