That Ozzie Attack On Google And Facebook Advertising Revenues

Australia is trying something that has been tried twice already – fiddling with the law so that he newspapers get more of the online advertising revenues. The moan being made being that it’s the newspapers who employ the journalists and thus carry all the expense. Why should the online giants gain all the revenue?

Of course, they don’t gain all the revenue, but “too much” is how it looks to the accountants in the newsprint business. So, boss, change the law so that we get more of it!

The background motivation here is that the newspaper business still has a significant impact upon politics and who gets elected with what majority. Thus the sight of politicians mounting Rosinante to tilt at the economic windmill.

It won’t work of course:

So, what’s the real argument here?
The underlying argument is that the media wants more of the ad revenue. They’ve not really got any leverage in arguing that Facebook or Google should be enjoying a lower margin on what goes on the newspapers’ own pages. They’d like it to happen, for sure, but there’s no great logic other than the desire to aid them in getting there.

So, they’re pointing to the advertising that appears on FB or Google’s own pages alongside those snippets from the media. Then claiming that at least some, more certainly if not all, should be flowing to the media companies. Effectively, they’re asking that copyright law be changed concerning the matter of snippets and extracts.

The platforms are saying that the media get lots of traffic from this, thus get to sell their own ads on their own pages – why isn’t that enough for them?

If the media wins in Australia then, as I say, this will spread and that will make a difference in the future to the platforms.

But who controls the rare thing?
This is the nub of the argument. In a market economy those revenues flow to whoever controls the rare thing. The money currently flows to the platform companies – we must assume that they control that rare thing. That is, it’s the audience which is the valuable thing, not the newspaper article. Our proof being that that’s the way the market economy is allocating those revenues.

We have two different sets of proofs here. One is that Spain said that G News must pay the newspapers spidered and included. G News closed in Spain and the newspapers complained about that. Germany tried to insist that a company could charge G News. G News then said anyone charging would not be spidered. All the companies do not charge.

The value is in the traffic, not the cut of advertising.

Our other proof being slightly technical. Every online site has a “robots.txt” file. Which, for us non-technical peeps, really says to any passing search engine “You may read and include this site” or “You may not read and include this site”. Near all newspaper site robots.txt files say “You may”. Thus the newspapers themselves say that it’s worth their having exactly what they’re complaining about.

This is an outbreak of cakeism.