The NMA has welcomed the Competition and Markets Authority’s interim report into the online platforms and digital advertising, but said that a full market investigation is necessary to “shed light on the open display advertising market and correct its most problematic aspects”.
In its response to the CMA’s interim report, the NMA called for a market investigation to consider the separation of Google’s ad server and ad exchange, running in parallel with the development and implementation of a “pro-competitive” code of conduct to regulate commercial arrangements between the platforms and the publishers.
The NMA agreed “wholeheartedly” with the CMA’s analysis of the relationship between publishers and platforms and welcomed its consideration of the points raised by the NMA and its member publishers.
The NMA said that the code, which would bring transparency and fairness into the relationship between publishers and the platforms, should be enforced with sanctions including financial penalties.
“We especially commend its acknowledgement of publishers’ reliance on platforms and the imbalance of power, resources and information which creates concerns such as changes to ranking algorithms without consultation or warning, platforms’ use of publishers content without compensation, their unilateral imposition of unfair terms, and the collection of readers’ data without reciprocation to news websites”, the NMA said.
The CMA’S decision to recommend the development of a regulatory regime for the tech giants was “strongly supported” by the NMA, but other measures such as the code and the market investigation were required to produce results quickly.
The NMA warned that unless swift action was taken to address competition concerns “the outlook for news publishers is bleak” with many smaller titles making a loss and in danger of closure, and national newspapers facing similar difficulties over time.
The NMA added: “Finally, and most fundamentally, there is an urgent need for measures designed to put an end to Google’s anticompetitive practices with respect to online display advertising (which is the main source of revenue for news publishers). As the digital market unit has not yet been put in place and the codes of conduct contemplated are still virtual in nature and will take some time to negotiate, there is therefore a significant danger that the measures needed to ensure that news publishers receive fair revenues for their inventory may be significantly delayed. Given the dire financial situation which many UK news publishers are in, such a delay may be lethal.” To read the NMA’s press release in full, click here.