Tech companies: a hindrance to democracy and free press

As the presidential election approaches, cracks in the digital facade begin to surface once again, reports The New York Times.

Facebook just removed an “I Love America” page, run by Ukrainians, which pushed recycled pro-Trump imagery from the Internet Research Agency, the Russian group that tried to influence the 2016 election. Similarly, in another case, another page with falsified content, “Police Lives Matter,” is now run out of Kosovo.

These two phony Facebook pages illustrate the crisis of the free press and democracy. Advertising revenue that used to go to quality journalism is now captured by big tech intermediaries like Google and Facebook.

This is the first presidential election happening after the business model for journalism collapsed. Advertising revenue for print newspapers has fallen by two-thirds since 2006. From 2008 to 2018, the number of newspaper reporters dropped 47 percent. Two-thirds of counties in America now have no daily newspaper, and 1,300 communities have lost all local coverage.

The signaling functions of news brands and the cultural barriers meant to guard against the distorting effects of advertising have broken down.

There are two drivers of this crisis. The first is the concentration of online advertising revenue in the hands of Google and Facebook. The second is an ethical breakdown, a natural consequence of advertising financing an information utility like a social network or search engine.

As the communications historian, Richard John argues, for roughly 200 years, American policymakers generally sought to decentralize media power and keep communication networks neutral. Now, enabled by a loose merger policy, there was a roll-up of the internet space. From 2004 to 2014, Google spent at least $23 billion buying 145 companies, including the advertising giant DoubleClick. And since 2004, Facebook has spent a similar amount buying 66 companies.

Data is now the key input into advertising. Tech platforms now control online advertising revenue, which is the primary source of financing for news. Google and Facebook are not in the journalism business at all; they are in the communications business, running information utilities with revenue that used to go to journalism.

The collapse of journalism and democracy in the face of the internet is not inevitable. To save democracy and the free press, there is dire need to eliminate Google and Facebook’s control over the information commons. It also means barring or severely curtailing advertising on any of these platforms. Advertising revenue should once again flow to journalism and art with people paying directly for communications services, instead of paying indirectly by forgoing democracy.