For the sake of democracy, social media giants must pay newspapers | Technology


The news that France’s court of appeal has ruled in favour of the French Competition Authority’s order that Google must negotiate payments with publishers for linking to their content has provoked predictable howls of outrage from the tech industry and their more sympathetic commentators. “This,” observes Benedict Evans, the analyst recently returned from a big Silicon Valley venture capital firm, in his invaluable weekly newsletter, “is a fascinating logical fallacy – it makes perfect sense as long as you never ask why no one other than Google pays to link either and never ask why it should only be newspapers that get paid to be linked to.”

The only place where the news of the French decision seems to have been greeted with enthusiasm is Australia, whose Competition and Consumer Commission (ACC) is putting the finishing touches to a mandatory news code that will be introduced to parliament before the end of the year. This code will, like the French ruling, force Google and Facebook to negotiate payments with Australian publishers for using their content.

The tech industry – or at any rate the surveillance capitalism wing of it – is not just outraged by the effrontery of the regulators, but also genuinely baffled by it. To the denizens of Silicon Valley, it makes no sense: after all, they see print publications as defunct because the business model that supported them has been undermined by the way the web snaffled most advertising revenue. Besides, who wants to read papers in an era when people get much of their news and other information online? Indeed, often the only reason people know about a news story is because Google has pointed them to the publication in which it appeared. So, concludes Mr Evans, characterising the need for compensation as a matter of copyright and competition, as the French and Aussies are doing, is “intellectually dishonest: this is a targeted tax of a politically unpopular company to subsidise politically connected companies”.

Citizens of UK towns now have much less information about what’s happening in their area than their grandparents did

Quite so. But buried deep in this mindset are two fundamental misconceptions. The first is its implicit determinism. The Silicon Valley credo is the doctrine that technology drives history and society’s role is to adapt to it as best it can. It’s a narrative suffused with Joseph Schumpeter’s idea that capitalism progresses by “creative destruction” – a “process of industrial mutation that continuously revolutionises the economic structure from within, incessantly destroying the old one, incessantly creating a new one”. This was the philosophy famously articulated in Mark Zuckerberg’s exhortation to “move fast and break things”. And implicit in it was the assumption that society’s only role on this voyage to tech nirvana is to pick up the pieces on the way. So how dare Australian and French regulators have the temerity to put up roadblocks on this inspirational journey.

The second critical flaw in the tech narrative is its indifference to the requirements of democracy. One of the lessons we have learned over a couple of centuries is that functioning societies need free media – free in the sense of liberty rather than free beer. I hold no brief for newspapers, per se, or for many conventional media organisations, but I think it’s unquestionable that the survival of liberal democracy requires a functioning public sphere in which information circulates freely and in which wrongdoing, corruption, incompetence and injustices can be investigated and brought to public attention. And one of the consequences of the rise of social media is that whatever public sphere we once had is now distorted and polluted by being forced through four narrow apertures called Google, YouTube, Facebook and Twitter, services in which almost everything that people see, read or hear is curated by algorithms designed solely to increase the profitability of their owners.

One sees the effects of this transformation of the public sphere at all levels, but one of the most disturbing is in the decline of local newspapers. In many regions of democratic states what goes on in the courts, council chambers, planning committees, chambers of commerce, trade union branches, community centres, sports clubs, churches and schools now goes unreported because local newspapers have gone bust or shrunk to shadows of their former selves. Citizens of most UK towns and cities now have much less information about what’s happening in their localities than their grandparents did, no matter how assiduously they check their Facebook or Twitter feeds. And the quality of local democratic discourse has been accordingly impaired.

The tech companies are not wholly to blame for these changes of course. But they have played a significant role in undermining the institutions whose business model they vaporised. Looked at from that perspective, it seems wholly reasonable that societies should require social media companies to contribute to the support of news organisations that democracies require for their functioning and survival. Mr Evans’s complaint that the French and Australian codes represent a “tax” is accurate as far as it goes. The only things wrong with it are that the proceeds should be funnelled to local news organisations as much as to the big newspaper groups and that it should be allied to measures to ensure that Google and co pay taxes proportional to the revenues they extract from the countries where they operate. In the case of Australia, for example, Google paid paid just A$133m on revenues of A$1.2bn. Which rather puts their complaints about having to pay peanuts to publishers into perspective.

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