Time to treat Google and Facebook as the media giants they really are

 
Ian Whittaker
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The rules and regulatory framework covering both Google and Facebook are lagging seriously behind the reality (Source: Getty)

The boss of WPP, Sir Martin Sorrell, has views on a wide range of topics, from the global economy, to Brexit, to the advertising world.

One of his views is that Facebook and Google are media companies, and should be seen as such.

And in this, he is absolutely right.

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There should be a recognition that Google and Facebook’s description of themselves as “tech companies” is not driven by a rational and unbiased view of their positions, but pure self-interest. Such descriptions allow them to portray themselves as exciting, edgy businesses, and to implicitly portray any opposition to their practices and market strength as biterness driven by neo-Luddites who just do not understand “the future”.

It also allows them to argue that they should be exempt from the rules covering traditional media, such as legal responsibility for what is published on their sites.

This was the argument put forward last month by Richard Gingras, head of Google News, who stated that Google was not a media company because it does not “produce media”, and thus has no legal responsibility for the content it hosts.

Yet both companies look like media companies, act like media companies, and should therefore be seen as what they are – which is media companies.

To start with, Google and Facebook’s business models are almost entirely reliant on advertising. They talk to advertisers about the reach they have over audiences. Google’s YouTube service has even started to carry out an upfront presentation to advertisers in the same way that the major TV companies do.

In fact, both firms have grown by taking money from other media companies – from the classified directories (who remembers the old-fashioned print Yellow Pages now?), and from the newspaper groups.

Both Google and Facebook are targeting the TV broadcasters’ advertising revenues, claiming that their reach and targeting make them superior platforms.

Nor does the argument over not producing content hold water. Channel 4 does not produce its own programming, but no one at Ofcom would claim Channel 4 should not be subject to the broadcasting rules.

It is also clear that the rules and regulatory framework covering both Google and Facebook are lagging seriously behind the reality – probably because, to a large degree, regulators and politicians are fearful of being accused of not understanding the new world. This allows these companies to get away with behaviour and market shares that, in most other situations, would be seen as cause for investigation and action.

According to StatCounter data, Google has just under 90 per cent share of the UK search market – even more dominant than the old Yellow Pages business in its heyday. Yet the regulators have done little.

The same goes for responsibility over content. Media worldwide is subject to rules regarding content and distribution, first with print and now with television, because of an understanding of how much influence its content has on audiences.

Both Facebook and Google have huge reach. They also control how content is placed (ask a price comparison site like Moneysupermarket.com what happened when Google changed its search algorithm). They enable a wide range of content to gain an audience that would have been impossible before the widespread advent of the internet, including material that is inappropriate and harmful – and, depending on whom you believe, may have influenced events such as the US presidential election.

It is time to ignore the self-serving claims that these media giants are really tech companies.

We must recognise them what they are – and act accordingly.

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