Big Tech don’t pay broadcasters enough

Author Moonshot.news

Published on: 13/05/2021

Radio and television stations’ local content – particularly news – provides great value for audiences on the major technology platforms. However, broadcasters are not fairly compensated for this valuable content because of the way the markets currently operate. The reason for that is simple – these tech platforms have substantial market power in their provision of services, and they use that power for advancing their own growth and benefit to the detriment of local broadcast journalism, US consultancy BIA Advisory Services says in a study.

The study found that each year US broadcasters lose nearly USD 2 billion in value that they generate for two of the largest technology platforms through publication of their content – particularly local news.

The study, “Economic Impact of Big Tech Platforms on the Viability of Local Broadcast News,” says broadcasters do not receive fair compensation for their local news content because of large tech platforms’ market power. BIA’s study of the tech platforms’ impact on local broadcasting concluded:

• No Technology Platform Currently Offers a Viable Economic Model for Broadcast News
• Algorithms Do Not Properly Weight Local Broadcast News Value
• Broadcast News Is Not Properly Identified
• Under the Guise of User Privacy, Google Gains Even More Market Power

Commissioned by the US National Association of Broadcasters (NAB), the study is focusing on Google Search and Facebook News Feed and says local broadcasters suffer an estimated total annual loss of USD 1.873 billion by providing their content to these platforms.

• Facebook News Feed lost value: $455 million with a range of between $325 million to $585 million.
• Google Search – zero click lost value: $1,289 million with a range of between $921.1 million to $1,658 million.
• Google Search – improper local news algorithm weighting: $128.6 million with a range of between $91.9 million to $183.8 million.
• The immediate impacts on local broadcasters from other platforms, namely Apple and Amazon, are not yet as dire, but the potential for future harm is likely as these platforms also have immense market power.

“Local news produced by local broadcast stations continues to be the most trusted, highly consumed and valued news source. Local news is very costly to produce, and yet its consumption and the advertising dollars that support it are shifting to technology platforms where broadcasters cannot fully recoup their investment or earn the economic benefits they create for the platforms because of unequal bargaining power.”

“This competitive imbalance puts a severe strain on the economics of local broadcasters and threatens their continued investment in local journalism.”