More than 60 percent of staff losses at Taiwan’s major newspapers could be traced to the monopolization of online advertising by Google and Facebook, posing a threat to the nation’s media landscape and its democratic system that relies on the third estate, a journalism expert said.
In a research report released yesterday, National Taiwan University Graduate Institute of Journalism professor Lin Chao-chen (林照真) issued a “wake-up call” about the effects of online platforms on the nation’s news media.
Nearly 60 percent of traffic to newspapers’ online content goes through Google and Facebook, but the platforms do not pay for the right to display it, Lin wrote.
Photo: Bloomberg
The digital platforms therefore have a monopoly on advertising, which traditionally provides most of the publishers’ revenue, she added.
News media around the world have long clamored for a solution to the issue, saying that the current landscape traps them onto major platforms while denying them a chance to earn critical advertising revenue.
Legislative solutions to the issue have gained momentum in the past few years, with the EU in 2019 passing the European Copyright Directive, which requires platforms to pay publishers for content aggregated on their sites. Australia last year passed the New Media Bargaining Code, and Canada is expected to follow suit.
In response, Google has signed deals with hundreds of media companies, agreeing to pay for the right to display their news content.
In Taiwan, the issue has only just started to be discussed.
To investigate the effects digital platforms are having on the domestic news environment, Lin reviewed the nation’s three major Chinese-language newspapers: the Liberty Times (the Taipei Times’ sister newspaper), United Daily News and the China Times.
Readers have developed new habits thanks to platform algorithms, which use news content to encourage people to spend more time on their sites to gather more data to sell to advertisers, she wrote.
Advertising volume — the amount of money spent on advertising and marketing efforts — in 1996 totaled NT$46 billion (US$1.55 billion), NT$11 billion of which was spent on newspapers, her research showed.
By 2020, overall ad volume rose to NT$60 billion, the majority of which, at NT$48.26 billion, was spent in online media, while newspapers collectively only made NT$1.1 billion, which Lin described as an “avalanche” of losses.
The newspapers’ Web sites attract up to 3 billion views annually, but 52 to 58 percent of them are still redirected from Google and — to a lesser extent — Facebook, she wrote.
Despite growth of 616 percent in online advertising on their sites, the cheaper price of digital ads means that a significant shortfall remains compared with traditional ads, she added.
The losses are directly reflected in dwindling staff and newspaper sizes, Lin said.
Her research found that over the past 25 years, the number of reporters and editors in newspapers’ local news divisions fell 62 percent from about 1,000 to only 324.
Newspaper sizes have also shrunk to about 20 pages from 30, with coverage of disadvantaged groups and local matters particularly affected, she said.
Overseas reporting has been devastated, with only two foreign correspondents left among the three newspapers from more than a dozen during their heyday, she said.
Without hiring a single editor or reporter, online platforms are able to present a variety of news to their users, whereas traditional media companies must hire staff to create content, she wrote.
As Taiwan’s news media weakens, so does its market for information and free speech, Lin said.
In the spirit of fairness, Taiwan should require platforms to pay for the news content they display, while publishers should negotiate with the platforms to find a solution, she added.
National Chengchi University College of Law professor Richard Wang (王立達) said that a special law tailored to address the relationship between digital platforms and news media is necessary.
Property rights need to be better defined to grant publishers the legal standing to require payment from platforms for content access, he added.
News media must also establish a channel of communication with the platforms to negotiate advertising profit sharing, he said.
An arbitration tribunal could also be created to impartially decide on terms in the event of a breakdown in negotiations, he added.
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