When you don’t have the FCC picking winners and losers, you have to compete
Right now, it is almost a national sport to hate the “mainstream media.” And with tone deaf abandon, the mainstream media is just adding fuel to that fire. A few days ago, a group of billionaire newspaper owners decided to appeal to Capitol Hill to ask that Congress protect their profits from the big, bad, profit-eating monster called competition. Specifically, the newspaper men want Congress to write special legislation that permits newspaper owners to negotiate as a group when contracting with Google and Facebook. In the antitrust world, that is called collusive price fixing — and it is against the law. If the newspaper men can get the exception (like the National Football League did over 50 years ago), they hope they can beat back the incredible market power of Google and Facebook in the advertising market. Of course, instead of seeking an antitrust exemption, the newspapers, like almost every other business, could try to compete in the marketplace on the merits of their product — but that’s a more difficult path.
Don’t worry about the newspapers getting what they want. That’s (hopefully) a non-starter. But let’s not miss the obvious analogy. Why should these billionaires lose? Why do they not get a “get out of fierce competition in the supply chain free card” if the biggest online content companies like Netflix or Amazon win by the imposition of Title II (price setting regulation) on internet service providers? Think about it. The newspaper men want the government to lower the prices that they pay to their suppliers — Google and Facebook. Netflix, for example, wanted the government to lower the prices that they pay to their suppliers — Comcast. The newspapers will fail because they will need to get their special deal from Congress. Netflix has an easier path to success because its supplier (Comcast) is conveniently regulated by the FCC and because Netflix tacked on its anticompetitive wish on the tidal wave of the popular, but largely unrelated, net neutrality principles.
Notice, the consumer is an afterthought in both the Netflix and newspaper special interest lobbying discussions. As I have written before, this is merely the battle of the titans. Large companies battle over one issue only: the level of revenue earned in one part of a supply chain over a different part of the supply chain. In the case of newspapers, they argue that they should be winners because their product is so important. This, even as public opinion has been steadily turning against the mainstream media to which these newspapers belong. But the newspapers are arguing about money — money for themselves — not freedom. As Ira Stoll of the New York Sun succinctly points out.
Even if you buy the questionable idea that more expensive news automatically equals better news, it’s a further, and even more tenuous, logical leap from that idea to the notion that Congress ought to interpose itself on one side of a set of business negotiations to make it easier for the publishers to make their news more expensive to consumers, or their ads more expensive to advertisers.
In the case of net neutrality, similar high minded yet unsubstantiated arguments to justify special treatment and higher profits abound. One tissue thin assertion is that “the edge” of the internet is more important than the internet service providers because only the edge contributes to the “virtuous cycle” of innovation in the internet. Like the newspaper men, this statement assumes much about the business of the internet ecosystem. It conveniently supports the profits of businesses that the government (not consumers) decides are meritorious, and it says nothing about the prices and experiences for consumers.
The bottom line is that no business — newspaper men or “the edge” — should be able to shield itself from competition by virtue of its ability to lobby Congress or the administrative state. If there’s one thing has been proven true again and again, consumers win when titans compete.
Πηγή: techpolicydaily.com
