Warped Online Market Pushing News Business to Brink of Collapse During Coronavirus
A recording of the call is here.
Today, Laura Bassett, former Senior Politics Reporter at HuffPost and co-founder of the Save Journalism Project joined ad marketplace expert Joshua Koran, Head of Innovation Labs at Zeta Global, and David Dayen, the Executive Editor of the American Prospect on a press call to discuss the dire state of the news industry amid the Coronavirus pandemic and Google and Facebook’s role in the crisis.
News outlets are providing essential coverage of the coronavirus crisis and the public is responding with a surge in traffic to news websites. But that new traffic is not producing increasing revenue. In fact, revenue is collapsing. Years of exploitation of the ad and browser marketplace by Google had already siphoned off tens of billions in revenue for news publishers. Now, advertisers are pulling back because of the rapidly contracting economy or barring their ads from appearing on pages with coronavirus coverage. Google is even rolling out more disruption for the ad marketplace with its plan to phase out third party cookies, a move it says will reduce ad revenue for news websites by 62%.
Joshua Koran, Head of Innovation Labs at Zeta Global, said, “Before the global community decides on how to re architect the Open Web, we should first agree on how we measure that we are making the Internet better. Ideally “better” provides consumers more choice, not less, both in terms of what content they can access and from whom. Critical to making this possible is ensuring we support the marketer effectiveness that funds the Open Web we all enjoy.”
David Dayen, Executive Editor of the American Prospect said, “This pandemic is a moment in which news and info is needed more than ever, yet the structure of news is ricketier than ever to deliver this information. As a publisher, these are very uncertain times and that’s to the detriment of a free press in this country.”
Laura Bassett, former HuffPost politics reporter and co-founder of the Save Journalism Project said, “Journalism has always been an advertising driven business. But Google and Facebook’s exploitation of that market had pushed some outlets to search for revenue from any source, whether that’s digital subscriptions, direct contributions from the public, or foundation grants. What is clear now is that all revenue streams for news publishers are under severe stress during the coronavirus pandemic at a time when the public needs reliable news and information more than ever. The urgency of this crisis has prompted the Save Journalism Project to make two specific recommendations: federal funding to be provided to local news outlets in the next coronavirus recovery legislation; and for Google to delay implementation of its phase out of third-party cookies on its Chrome browser. Google’s own study found that eliminating third-party cookies would reduce ad revenue for news outlets by an average of 62%, with local outlets hit even harder.”
John Stanton, former D.C. bureau chief of BuzzFeed and co-founder of the Save Journalism Project, said, “The plight of the journalism industry during the coronavirus crisis has received a lot of attention. But too often overlooked is just how devastated the news business was before this latest crisis. Hundreds of newspapers have closed and tens of thousands of journalists have lost their jobs over the last decade as ad revenue for news outlets has collapsed while it has skyrocketed for tech giants like Google and Facebook. We think the evidence clearly shows that Google has exploited the marketplace through its monopolistic control of the ad market and web traffic. And that exploitation is continuing during this crisis.”