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News production and journalism can not be left entirely to market forces and regulation is needed to limit the power of Facebook and Google, said the regulator of competition.
ACCC President Rod Sims said the Digital Platforms Survey, which released its preliminary report in December, revealed that the market power enjoyed by digital giants is weakening the media. Australian.
More than a quarter of traditional journalism journalism jobs had disappeared, print advertising revenues had dropped dramatically, and for every $ 100 spent on online advertising, $ 47 went to Google and $ 21 to Facebook.
In the last three years, Google and Facebook have captured 80% of the growth of digital advertising.
However, if they account for the lion's share of advertising revenue, the platforms do not create original and quality news in Australia.
"Instead, they select, organize, rate, rank, and organize news stories produced by third parties, broadcasting content from other parties," Sims said.
However, the company benefits from an extensive and diverse range of media sources, in addition to the two public broadcasters, ABC and SBS.
"Information and journalism differ from many other commercial activities in that they benefit both the individual and society as a whole," he said.
"The plurality of editorial voices contributes to the public interest and we should not be in a position to trust one or two sources of information.
"Given all this, it is also essential that media companies are not disadvantaged by the exercise of market power or other mechanisms that prevent them from competing on their merits. "
Sims said the new entrants on the market, such as Guardian Australia, Crikey, BuzzFeed and The Daily Mail, do not make up for the increasingly smaller newsrooms of the former Fairfax Media, which is now part of Nine, and News Corp Australia, because they usually operate very small newsrooms.
The financial viability of these companies is not badured either, as demonstrated by BuzzFeed and Vice who recently announced layoffs in Australia and around the world. The small BuzzFeed news business will actually be shattered by the global cuts in the sector, which have targeted 11 editorial jobs in Australia.
Sims said the final report of the investigation should address confidentiality and data collection issues.
The lack of transparency regarding the amount of data collected on consumers was a major concern.
The preliminary report recommended a powerful new authority to oversee the commercial activities of Google and Facebook.
The new regulatory body would have the power to investigate all aspects of the digital platform's business and subsidiaries and would have jurisdiction over any platform generating $ 100 million in revenue in Australia.
"Virtually no media regulation applies to digital platforms, which contributes to the disparity of regulation between media sectors, which seems to offer digital platforms an unfair advantage in attracting advertising costs. advertising because they are subject to less regulatory constraints and have a lower compliance cost ", he said.
The competition regulator also examines the Coalition's "employment and innovation package", which is part of the media reforms adopted last year: tax offsets for the production of certain types of news and journalism, and deduction of personal subscription to the news media. .
Submissions in response to the draft report are due this week, before the final report in June.
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