Media industry cost-cutting measures may hurt bottom lines
Posted on: Sunday October 10, 2021
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Kuala Lumpur: CGS-CIMB Research said it believes the cost-cutting measures taken by local news media companies may actually hurt their bottom line. journalistic quality, the credibility of information being all the more at stake today as fake news is increasing on social networks. âIn our opinion, news producers have a compelling case against the tech giants. Since they are global in scope, Google and Facebook could easily lower advertising rates so that advertisers go to them rather than local publishers, âhe said in a research note on Friday.
“Yet they are only aggregators of information, while those who produce the information receive a meager sum.” At this point, there is no certainty that the Australian episode with Google and Facebook will pave the way for other countries to follow suit, the research house said in reference to Google’s compensation deal with Australian news organizations. “However, remember that in April 2020 the Malaysian Association of Newspaper Publishers urged the government to introduce legislation similar to the one proposed by the Australians,” he added.
The Australian government and news producers – primarily News Corp – had for years pressured Google and Facebook to start compensating local publishers for news links and snippets that surfaced on their engines of research. The argument is that these tech giants have benefited tremendously from the publicity that appears when people search for this news, but the news producers are not being reimbursed for their work. In July 2020, the Australian government introduced the draft news media bargaining code. In early 2021, Google threatened to pull out of Australia, but eventually relented in September 2021 to pay News Corp and other publishers as part of a multi-year deal to compensate these news companies for a sum. not disclosed. Facebook, however, has chosen to prevent users from posting links to content produced by Australian news producers.