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Google and Facebook could lose their largest market, the US, due to this law

Legislation in the US would only give smaller media greater bargaining power with Google and Facebook together

On the other hand, the proposed law in Australia contemplates a direct payment for each time these platforms display a news link

Both the social network and the search engine have criticized the proposal, saying it does not show a clear understanding of how the web works.

A new legislation could endanger the advertising business, and even the permanence, of Google and Facebook in the United States (USA). According to ., a competition committee in the House of Representatives of Congress is planning a new law. This would allow the smaller news outlets in the country to come together to negotiate content deals with these technologies. And thus, reach better negotiations in the future.

The News Media Alliance, a US news media industry organization, is pushing for this legislation. According to the president, David Chavern, Facebook and Google are reaching out to smaller companies by closing compensation deals. Not only that, but they force them to close confidentiality agreements. This prevents publishers from “being able to compare notes”. And unlike bigger agents, they can’t demand a better deal.

In this sense, the legislation would only allow small news producers to have the possibility to join together and negotiate in unison with Google and Facebook. The law would have the support of both parties, which enhances the possibility that it will be implemented in the future. It is not clear when he will be presented to the plenary session of the House of Representatives. But it was anticipated that it will be only the first of several proposals on the competitiveness of Big Tech in the US.

Why Facebook and Google should be concerned

The news of this legislation comes in a week where both technology companies have received a couple of pretty hard blows precisely in the news environment. Facebook made a decision in Australia that was harshly criticized around the world. Due to the legislation that wants her to pay for each news link, she decided to block all this content overnight. Many saw the action as a sign of why they regulate Big Tech.

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Google, for its part, is not only suffering from the legislation that it wants to impose in Australia, trying to close content agreements with all possible publishers. This action was also carried out in France, but without the expected results. While he is no longer at war with the big news outlets, he did infuriate smaller publishers. These agents claim that the brand left them aside, without giving them adequate remuneration.

The new legislation that is being proposed in the US Congress could put Google and Facebook in an uncomfortable position. In France and Australia they have threatened to withdraw their services if regulators do not strive to reach a middle ground with them. But they cannot afford this luxury in the American Union. Both Mark Zuckerberg and Sundar Pichai generate the vast part of their income in this region, so they cannot lose it.

Solutions to the conflict with the media?

The situation is complex and there does not appear to be a clear answer to either the challenges of Facebook and Google or the dependence of the news media on these platforms. According to Digiday, there doesn’t seem to be a way out. Regardless of whether these leaders of the digital environment want it or not, they will have to become one of the main sources of income for the media. And in this sense, the media must also accept this reality as soon as possible.

Other agents believe that continuing these efforts is the worst possible solution for the news media. According to Business Insider, the relationship with Google and Facebook is not the reason publishers have lost money. This is explained in the new search mechanics and content consumption within the internet. And in this sense, rather than forcing Big Tech to subsidize the media, new models of subsistence should be sought.