Unfair competition undermines role of free media in a democracy: Paul Fletcher

At e4m-DNPA Future of Digital Media Conference, Paul Fletcher, Member of Parliament, Australia, spoke and made a presentation about 'Australia’s Law on Technology Platforms and News Publishers: Background and Analysis'. Fletcher was joined by Puneet Jain, Chief Executive Officer, Hindustan Times, for a chat to discuss more on the topic.

Fletcher opened his session by sharing lessons from the initiatives taken by the former Marshall government in Australia to regulate the impacts of global digital platforms like Facebook and Google on the news media sector. Sharing the issues that the News Media Bargaining Code is supposed to address, Fletcher shared, “There were certain problems that we needed to address namely the market power of FB and Google in digital advertising. In every market that they operate, they capture very larger share and the revenue that it brings. Yet, the content that they use very successfully to monetize their advertising revenue is from the media companies that they are competing with. In our view, it was a serious competition policy problem.”

Adding more to this, Fletcher shared that it is also a problem of media policy.  He said, “An adverse and rigorous media sector, producing hard quality journalism costs money and needs to be paid for. In most countries, privately owned media businesses, which generate much of their revenue from advertising, play a very important role in providing diverse sources of news which are not only reporting what the government would want to be reported. If incumbent news media business are losing advertising revenue to Fb and Google, they are becoming weaker financially, they employee few journalists, stories become shorter and less detailed and these media outlet start to go out of business.”

Tapping into the third very important problem that the News Media Bargaining Code is trying to address, Fletcher added, “It also undermines the very important role that the free and independent media sector plays in a liberal democracy. The work of journalists is important in holding up to public scrutiny, but if the commercial model which sustains the employment of journalists, is fundamentally eroded due to unfair competition then that means fewer journalists, reduced scrutiny of the government and a material reduction in the effective operation of the democratic system under which many democracies around the world operate.”

Joining Letcher for a chat, Jain posed a question to him on whether unfair competition flagged by him holds true for other large markets as well and is legislative action the only way to tackle it? Answering the same, Letched said, “We saw this as a competition policy issue. Competition is a good thing, it drives innovation and that in turn delivers better outcomes for consumers, but unfair competition is a problem and that is why most countries have a law in place for this. One of the lessons from our experience is that we need to have a look at these competition policies, especially in terms of policy response, if you determine that a policy response is justified.”