Tech giants are strangling the press – Caxton

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NATIONAL NEWS & VIDEO - While freedom of the press is one of the most important freedoms to ensure constitutional democracy, the press has never been under greater threat.

“This is because while our right to publish may be intact, our ability to publish is being hamstrung,” said Paul Jenkins, Caxton & CTP Publishers & Printers’ (Caxton) non-executive chairman.

Caxton is one of numerous media organisations that made a detailed submission to the Competition Commission’s Media and Digital Platforms Market Inquiry (MDPMI), which is investigating the distribution of media content on South Africa’s digital platforms and advertising technology (Adtech) markets.

Jenkins, who presented Caxton’s submission to the MDPMI yesterday morning, was discussing how news organisations are being ‘starved of advertising revenue’ by the digital revolution, all while the giants in the online industry are exploiting the content that comes from news organisations that are dying, without remunerating them.

“Eventually there will be no news content.

“All media are very concerned. This model is broken. News is declining, news is under threat, and this is not a false alarm. No one is crying wolf,” said Jenkins.

While Caxton has adapted and met exponential digital changes over the past few years, its business model is under threat.

“This is due to market failure and tech dominance… They are snuffing out the oxygen of news reporting, which is a vital public good and a costly exercise,” said Jenkins.

Jenkins explained that advertising revenue, which previously sustained newsrooms, is being diverted to the tech giants, which are ‘parasitically exploiting’ Caxon’s and other media houses’ news content. This affects advertising revenue that, in Jenkins’ words ‘keeps us alive’.

While the intention of Caxton’s submission to the MDPMI is not to single out any scapegoats for the accelerating decline in news reporting, representatives indicated that is necessary to focus on the giants in the online industry that dominate media and digital platforms and the Adtech stack – namely, Google and Meta (Facebook) – said Caxton in its submission.

“We don’t see a viable digital future for news media without action being taken by regulators.

“This is due to what we see as the anti-competitive conduct of digital platforms, the effect this conduct has on the distribution of news content online, and the impeding of newspapers’ abilities to monitor content through advertising.

“These platforms have a life of their own and are operated purely for commercial purposes. They don’t differentiate between news content, other peoples’ content, clickbait or false news – their aim is to make money from advertising and public good goes out the window,” said Jenkins.

The news organisations trying to fulfil a public good and make money out of newspapers but face declining circulations, he added.

Caxton’s Digital Group Executive Servaas De Kock told the MDPMI: “All we want is for them [Google] to be fair, compensate us for the content we provide, and offer opportunities for us to continue generating quality news to keep our communities informed.”

Katherine Bell, General Manager at Hive, Seelan Pillay, Digital Director at The Citizen, Servaas de Kock, Group Executive Digital for Caxton and CTP and Paul Jenkins, Caxton & CTP Publishers & Printers’ (Caxton) non-executive chairman.

Transition to digital

While the transition to digital has been difficult for most media, the shift for local media came with unique challenges.

“As we publish community news, and it is for the public good, it has to be free. We cannot put our content behind a paywall,” said Jenkins.

While Caxton initially saw its relationship with Google as that of a partner, over the years the tech giant has become a major competitor that does not disclose various information needed by the media house to make informed decisions, said Jenkins.

“It’s now a situation where the winner takes all.”

The inquiry is holding public hearings for stakeholders from 2 to 24 March.