20.2.1 Platformisation

A major digital shift has altered the ways in which news is produced, distributed, and funded in both positive and negative ways. There is abundant literature and ongoing research on this ‘digital shift’ in both cultural and news production and dissemination.Footnote ⁷ This shift is not going away anytime soon. We must accept, for example, that print will continue to dwindle. Then, there is reintermediation via major tech platforms, a phenomenon referred to as ‘platformisation’. In a nutshell, news, however it is produced and by whom, is now more often accessed via global platforms such as Google and Facebook.Footnote ⁸ In what has been dubbed by many an ‘Age of Giants’, global super-players thus serve as the main venue for commercialising digital content and reaching an audience. Research shows that the digital shift has directly affected national information sources and cash flows.Footnote ⁹ To that extent, the diagnostic part of the recitals of the CDSM Directive creating a right for press publishers, which the chapter will discuss in detail in what follows, is spot on.

Search engines and the AI-based algorithms that power them play an ever greater role in deciding which information a user gets,Footnote ¹⁰ making platforms a ‘gateway to readers’.Footnote ¹¹ Platforms are not merely performing a distributional function; they are also allocative (attention allocation). A veritable reengineering of news is afoot: specific content is pushed to a user by an AI-powered algorithm based on the user’s personal data, a phenomenon encapsulated under the term ‘personalised news’.Footnote ¹² This applies both to advertising and to news content. One of the important drawbacks is that users may see very little material that forces them to rethink existing beliefs and assumptions.Footnote ¹³ This is especially true in the political field, where the typical internet user sees ‘more of the same’, often accompanied by a demonisation of people who hold a different view – the so-called echo chamber effect, the exact scope of which is disputed.Footnote ¹⁴

Many news media now plan strategically to make the news suit the platforms.Footnote ¹⁵ This involves the use of data analytics to target specific audiences as well as long-term strategies on how to gain and keep platform users. The content is constantly changed or tweaked to be optimised for platform distribution and monetisation. Nieborg and Poell point out, for example, that news organisations spend more and more resources on platformed distribution of individual stories (‘large-scale content unbundling’). Combined with platform companies’ efforts to develop native hosting and monetisation programs such as Facebook’s Instant Articles, this development may ‘reduce news organizations to mere content developers’ instead of focusing on highly curated content packages (i.e. newspapers).Footnote ¹⁶ This is self-evidently liable to produce deep impacts on democratic processes, as news is disseminated by platforms based on user preferences and ad revenue maximisation.Footnote ¹⁷ The well-known US scholar Victor Pickard even suggested in that context that ‘Tweaking market mechanisms and scrambling for new business models is futile when the market itself is a core part of the problem.’Footnote ¹⁸

Digital journalism researchers have investigated the relationship between news organisations and platform companies, and specifically how competition among them affects the incentives for investigative and other forms of journalism.Footnote ¹⁹ There is also good research on how digitisation and a more global advertising market have changed the competition between legacy news organisations themselves.Footnote ²⁰ From this research we learn among other things that platformisation directly affects the production of certain types of quality journalism, especially investigative and economic reporting (both of which often involve extensive fact-checking and analysis) and local journalism, all of which are particularly important in fulfilling the press’s ‘Fourth Estate’ role in a functioning democracy.Footnote ²¹

The ongoing shift to global platforms has had positive impacts as well, and in some cases positive implications for democracy. For example, global platforms such as Facebook have made content more accessible and manageable, opened up popular participation in democratic processes, and stimulated innovative ways of producing news. Yet there have been undeniable major negative impacts on financial flows to legacy news organisations, which typically had a dual business model relying on the sale of copies and on advertising. The latter source of income was essential for many organisations. That stream has shifted from legacy media with high content-production costs to platforms with little or no content-production costs.Footnote ²²

The problem goes deeper still. There is a potential conflict of interest in that platforms do not share the professional journalists’ and news organisations’ desire and indeed their social responsibility to produce fact-checked, free (independent) news based on a norm of objectivity, which the CDSM Directive, like this chapter, refers to as ‘quality journalism’.Footnote ²³ The idea that basic fact-checking, for example, may be subordinated to the need to generate more revenue seems hard to reconcile with the notion of objective quality journalism.Footnote ²⁴ Put simply, for global digital platforms, generating or providing access to information that meets journalistic standards is unimportant or much less important and certainly not mission-critical. In some cases, platforms might even see it as squarely unproductive, as it may drive a user away from their site or platform because for that user stepping out of the comfort of the echo chamber may require a greater mental effort and the user might click away to avoid it. One example of the potential outcomes of this conflict is the generation of unverified news by machines, so-called robot reporters.Footnote ²⁵ The use of AI creates a second structural disruption distinct from platformisation: revenue displacement and epistemic substitution.

In sum, the literature points to a potentially dramatic deterioration of the ecosystem for both professional news organisations and journalists and thus of the very existence of quality journalism. Identifying the proper response is about maintaining and rebuilding an ecosystem in which professional news organisations, including local ones, can survive and ideally thrive in the Age of Giants and can keep producing quality journalism.

20.2.2 What Is the Objective That Policy Should Pursue?

If platformisation describes the transformation, the next question is normative: what exactly should regulation seek to preserve? In their influential work Comparing Media Systems, Hallin and Mancini, addressing some of the criticism raised against Siebert, Peterson, and Schramm’s well-known Four Theories of the Press (1956), make empirical inquiries and comparative analyses to identify ideal media systems.Footnote ²⁶ Focusing on media systems in Canada, the US, and Western European countries, they construct a framework for analysis based on four dimensions: the degree and shape of development of media markets, the degree and nature of links between political parties and the media, the degree of development of journalistic professionalism, and the degree and nature of state intervention in the political system. They identify three models: the liberal model, the polarised pluralistic model, and the democratic corporatist model. In all three models, journalism is seen as a normative practice, anchored in social responsibility theory, whereby news media are guided by a ‘social contract’ between the state, the people, and the media. The social contract metaphor also explains the necessity of journalistic ideology to maintain the function of the press within this system.

Scholars and media practitioners have discussed the reality and future of this approach as well as its paternalistic leaning. As an alternative, a more ‘neutral’ public or civic model of local journalism (with emphasis on mobilisation and encouragement of popular participation in local matters) has gained prominence, stimulated by the interactional possibilities afforded by the new media.Footnote ²⁷ That said, the social responsibility ideal continues to play a central role for the public, professional, and scholarly understanding of news media’s value in a Western liberal democracy.Footnote ²⁸

Independently of the exact model chosen to explain its role, however, media pluralism (assuming that news organisations abide by the ‘social contract’) is unquestionably desirable. As the CDSM Directive notes, a ‘free and pluralist press is essential to ensure quality journalism and citizens’ access to information. It provides a fundamental contribution to public debate and the proper functioning of a democratic society.’Footnote ²⁹ We need journalism that both holds power to account and informs and provides context for public discussion of policy issues.Footnote ³⁰ This implies the ‘institutional/political imperative of independence’.Footnote ³¹

When Article 11 of the Charter says that media pluralism must be ‘respected’ and, correlatively, that EU citizens have a right ‘to receive and impart information’, this has key implications. First, why do EU citizens have those rights? In the view taken in this chapter, it is because, combined with the right to vote and stand for elections also guaranteed by the Charter, the rights in question place the people as the ‘symbolic locus of power’ in the EU.Footnote ³² This in turn provides democratic legitimacy to the legal order, a theory espoused in various forms by Hobbes, Locke, Rousseau, and Kant, to name just those intellectual heavyweights.Footnote ³³

One should define pluralism in this context. There is a complex relationship between media pluralism and other forms of pluralism, in particular value pluralism. The link between value pluralism and political pluralism can be made convincingly, as Isaiah Berlin demonstrated. That link explains why media pluralism can serve as a basis for democratic institutions to function. As Berlin explained:

Other than the dated gendered language, this seems entirely correct. For citizens to be able to ‘give answers’ to social questions, and be confronted with the values of other citizens, quality journalism and socially responsible news seem essential. Journalists make mistakes, but they should aim to inform as best they can, checking sources and correcting their mistakes when, for example, scientific advances show that previously held scientific fact is incomplete or even incorrect. Journalistic intent and a commitment to aim for objective ‘truth’ should matter.

20.3.1 A Menu of Options

There have been various regulatory responses around the world to the ‘digital shift’ in news production and dissemination discussed in Section 20.2. Those efforts have often aimed to strengthen the position of legacy news organisations, where much of the expertise in news production still resides.

Existing research on those regulatory responses to the digital shift is fragmentary at best. Scholars have discussed possible changes to copyright law and related rights;Footnote ³⁵ the desirability and impact of state subsidies to news organisations;Footnote ³⁶ exemptions from competition law to allow price-fixing;Footnote ³⁷ the creation of new cooperative (citizen-owned) models in various areas;Footnote ³⁸ improvements in the operation and regulation of copyright management organisations;Footnote ³⁹ and changes to labour laws.Footnote ⁴⁰ Some very tailored regulatory proposals target how global platforms prioritise and choose information and in doing so create possible conflicts with freedom of the press.Footnote ⁴¹ Courts, legislators, and policy makers have also struggled with how to define and separate journalism from other types of publication. Research has shown that legal definitions vary among countries.Footnote ⁴²

In what follows, the first point of focus will be the EU press publishers’ right. Section 20.3.2 examines alternative responses that are more likely to achieve the objective described in Section 20.2.2.

20.3.2 The Press Publishers’ Right

The press publishers’ right (PPR) contained in Article 15 of the CDSM Directive was presented as a way to save the media. The CDSM Directive builds on what seems an unassailable normative foundation, particularly in its recital 54, already quoted, which refers both to the essential role of a ‘free and pluralist press … to ensure quality journalism’ and the role of the press in ‘the proper functioning of a democratic society’.Footnote ⁴³

The push for the PPR comes from a belief that the media need ‘saving’ from platformisation, the phenomenon described in Section 20.2.1, namely the drastic and rapid changes to financial flows brought about by the central role of global digital platforms (not just Google and Facebook – Alphabet and Meta if you insist – but also TikTok and others) in providing access to news seen as a public good.Footnote ⁴⁴ The CDSM Directive basically sees the issue as one of licensing for both legacy organisations and new entrants, the latter described as ‘new online services, such as news aggregators or media monitoring services’.Footnote ⁴⁵ According to the CDSM Directive, they face essentially ‘problems in licensing the online use of their publications to the providers of those kinds of services, making it more difficult for them to recoup their investments’.Footnote ⁴⁶ Hence the Directive creates a new related right to allow for better licensing of press content, asserting that the ‘organisational and financial contribution of publishers in producing press publications needs to be recognised and further encouraged’.Footnote ⁴⁷ It seems, in other words, that generating revenue for ‘publishers’ of news will maintain their business model, which in turn will maintain their above-mentioned role in a democratic society. Will it work?

As the research summarised here suggests, there is a huge amount of amassed expertise in generating quality journalism, which requires professional journalists equipped with proper resources. The research examined in Section 20.2 also suggests that without quality journalism, democracy is in peril.Footnote ⁴⁸

The PPR will not directly affect the transition to personalised news, but can it help maintain existing news organisations? Empirically, the effects thus far are not impressive. Like in Australia, where major news organisations obtained a lion’s share of the deal with Facebook, the same has reportedly happened in Germany and Spain after the introduction of the PPR.Footnote ⁴⁹ Indeed, the PPR seems to have increased media concentration. This is not liable to increase media pluralism and puts the CDSM Directive potentially at odds with Article 11 of the Charter.

20.3.3 The Key Problems with the PPR

Here is the crux of the issue: the PPR does not guarantee that the news organisations receiving extra income will (continue to) produce quality journalism, nor does it operationally distinguish between news organisations that produce this type of journalism and the other ones. The PPR keeps organisations afloat, not journalism, and there is a difference. Now, this quandary was admittedly unavoidable. The Directive cannot select which news organisations are ‘good enough’ without a risk of running afoul of Article 11 of the Charter. This means that the PPR can maintain or enhance financial flows to both ‘quality’ and ‘non-quality’ news organisations. It maintains part of the institutional status quo, though not preventing new players from qualifying. What will matter in the end is what news users actually access, and the PPR will not directly affect this. If AI is used to target users using their preferences, it is those algorithms that will ultimately decide who lives or dies in this new environment. As on Apple Music, Spotify, and the like, the number of streams is the coin of the realm, and so it will be with news. If users do not want quality journalism in sufficient numbers – and want it enough to override what is chosen for them – then the PPR will end up being un coup d’épée dans l’eau. If users prefer low-quality echo chambers to the idealised quality journalism extolled by the CDSM Directive, what can copyright and related rights actually achieve? After all, those rights are, and have always been at bottom, market-based incentives.

Then comes the rights duplication issue. As the Directive notes, authors of journalistic content have authors’ rights in their work, which may be transferred to the publisher, thus making the publisher the effective right-holder. For example, reprographic rights organisations generate significant income for holders of rights in journalistic content.Footnote ⁵⁰ This is said to be unaffected by the PPR.Footnote ⁵¹ This then begs the question why a second layer of right was required, as almost all content is produced by human authors whose literary or other productions are already protected by law. There is, as Christophe Geiger noted, a risk that ‘the grant of rights to ever more actors will decrease the economic value of each right covering essentially the same economic use’.Footnote ⁵² As I have argued elsewhere, one clear step we can take to avoid putting the full force of the market behind the replacement of journalists is to continue to recognise that authors’ rights are based on human creative choices, what the author of this chapter has referred to as a human ‘cause’.Footnote ⁵³

It gets worse. In what seems an unintended consequence, the PPR likely protects AI-produced content that would otherwise be denied copyright protection due to a lack of originality. Ironically, a right justified as protecting journalism may create economic incentives to automate it. As Eleonora Rosati notes, the PPR ‘reflects the investment made by the concerned press publisher, irrespective of how much has been copied and whether what is copied is original in a copyright sense’.Footnote ⁵⁴ This could create an incentive for publishers to use more AI and fewer journalists – a perverse result to be sure. Because the right protects content whether or not it is produced by human journalists, and because human journalists are more expensive (and need time off, work/life balance, and all those petty human things), a neoclassical economist might expect publishers to rely on humans less and less to produce the news, unless they be guided by high ethical principles of quality journalism or subject to regulatory interventions meant to keep journalism human – at least to some extent.

The reference in Article 15(1) of the CDSM Directive to ‘the rights provided for in Article 2 and Article 3(2) of Directive 2001/29/EC’ could, one might argue, incorporate by reference the notion of originality in EU copyright law, but the intent, it seems, was to refer to the right just to define its scope, not its subject matter.Footnote ⁵⁵ The notion of ‘press publication’ in the Directive is not limited to literary works of a journalistic nature, as recital 56 refers explicitly to ‘other subject matter’.Footnote ⁵⁶ Certainly, the Directive does not expressly require that PPR recipients work exclusively with human journalists. Incentives created by the PPR may pull in the opposite direction. Without authors to share with, the publishers would keep more of the (new) revenue stream generated by the PPR. True, one might say that publishers would want copyright (and, therefore, human authorship) to benefit from protection in addition to the PPR because the PPR has a very short term of protection compared to copyright, but that argument can be discarded because two yearsFootnote ⁵⁷ is longer than the actual shelf life of almost all press publications. For many press publications, economic relevance rarely extends beyond days or weeks. In that light, a two-year term already exceeds their practical market life. Which news item needs a term of protection covering the life of the author plus seventy years? To limit the PPR to human-created news, one would have to adopt a purposive interpretation and argue that if the PPR’s purpose is the survival of quality journalism, that cannot be accomplished without journalists. In determining whether the PPR will accelerate the elimination of jobs for human journalists, the future may reveal how loud money can talk.

There are other issues with the PPR that will not be addressed here as they are less directly relevant to the topic, but they do matter; they include the Directive’s variegated implementation in Member States.Footnote ⁵⁸

20.3.4 Alternative Legal Tools

The PPR is but one way for legislators to respond to the shift to digital news. Other avenues to explore include platform-specific content regulation, competition law (e.g. Australia’s ‘forced’ negotiations of revenue-sharing arrangements),Footnote ⁵⁹ taxation of tech platforms (discussed by the OECD),Footnote ⁶⁰ state subsidies, media ownership rules, and regulations to support the use and prevent the circumvention of paywalls. Regulatory limits on the financial and ownership relationship between global platforms and legacy news organisations have also been proposed. The purchase of the Washington Post by Jeff Bezos (founder of Amazon.com) provides, indirectly at least, an example of such a potential role for the regulator.Footnote ⁶¹

This chapter shares Neil Netanel’s view that the problem will not be solved by creating a related right (the PPR) in links to news because the problem lies elsewhere: it ‘stems primarily from the duopoly control over digital advertising held by Internet giants Google and Facebook’.Footnote ⁶² A better response, from that perspective, would rest on competition law. A perverse impact of the PPR is that it could delay or even prevent recourse to competition law. A competition law remedy could take the form of Australia’s rather weak and ill-formed – but nonetheless noteworthy – mandated bargaining approach.Footnote ⁶³

Another solution would be more public funding, an option alluded to in Section 20.3.3. This chapter expresses some sympathy for this approach, as many European countries have public broadcasters and other publicly funded (including local) media. The hard question is how to fund the media at an appropriate level while maintaining the independence they require to function as producers of quality journalism. Scholars have suggested a tax on digital advertising revenue to generate the necessary funds.Footnote ⁶⁴ This option would be worthy of further research in a European context.