At the end of March, I attended the 57th Annual Scripps Lecture at my alma mater, the University of Nevada, Reno. The event, put on annually by the Reynolds School of Journalism, highlights recipients of the Edward W. Scripps II scholarships and internship and features a keynote speaker of some import in the journalism field.
The address by Kristen Go, executive director of news and initiatives at USA Today, dove into her personal journalism journey. In the Q&A that followed, the elephant in the room — the one in the corner of every print newspaper’s room — was brought up: How do newspapers compete with the likes of social media? Go’s answer was what a lot of journalists are telling themselves these days: that digging for the truth matters, that our communities recognize that quality journalism trumps knee-jerk Facebook posts, and that at the end of the day, watchdog journalists uncover information the public deserves to know about.
All nice statements in theory, but it’s becoming harder and harder to repeat them to ourselves in the mirror each morning, in the face of growing and seemingly insurmountable odds.
“The U.S. newspaper industry is fragile: Newsroom employment, circulation, print advertising spending, and the number of local news outlets are all falling consistently each year. The immediate future of the market will see … more local papers lose their fight to survive independently and [be] taken on by private equity firms and hedge funds. Concerns that prioritizing quality journalism will give way to the desire to make a quick profit are rife, and given the state of the industry, remain valid.”
~ July 2021 Statista update on the U.S. newspaper industry
At Moonshine Ink, we believe the quest for truth is worth weathering the looming storm clouds of diminishing newspapers.
We’re not alone. In January 2021, a West Virginia newspaper company, HD Media, filed a federal antitrust lawsuit against Google and Facebook (reintroduced in October 2021 as Meta), claiming the massive companies are monopolizing the world of digital advertising.
When one company controls a market, its competitors whither and consumers have no choice but to buy from the monopoly, which can jack up prices for products without fear of another business swooping in. Antitrust laws, outlined in the 1890 Sherman Act, focus on keeping monopolies at bay by encouraging competition among businesses — unlawful mergers or business practices can yield criminal prosecution and penalties.
Facebook’s and Google’s overreach of the digital ad market, the suit claims, is raking in revenue that would’ve ended up funding local news. The two tech giants capture over half of the digital ad market globally.
“There is no longer a competitive market in which newspapers can fairly compete for online advertising revenue,” the HD Media suit states. “Google has vertically integrated itself, through hundreds of mergers and acquisitions, to enable dominion over all sellers, buyers, and middlemen in the marketplace. It has absorbed the market internally and consumed most of the revenue.”
The lawsuit calls out a secret agreement between Google and Facebook in 2018, codenamed Jedi Blue and exposed by the Wall Street Journal in 2020 as an illegal price-fixing deal. While the details are complex, basically the two tech companies colluded to manipulate online auctions that generate digital advertising — basically eliminating rival ad tools and thus continuing to keep billions of dollars in annual profits to themselves.
The tech giants are fielding antitrust challenges on multiple fronts. A few months prior to the HD Media case, the U.S, Department of Justice filed an antitrust lawsuit against Google for similar reasons, “alleging that the tech giant has unlawfully monopolized the markets for general internet search services and search advertising,” as stated in its initial observations. In this case, Facebook was only mentioned as another big tech firm under investigation. Then, on Dec. 16, 2020, 10 states collectively sued Google, accusing it of working with Facebook to monopolize digital advertising in violation of antitrust law.
Yet HD Media was the spark that lit the antitrust match solely in the name of newspapers, the first that speaks to these allegations as a violation of the First Amendment.
“A free and diverse press is essential to a vibrant democracy,” the lawsuit points out. “Whether exposing corruption in government, informing citizens, or holding power to account, independent journalism sustains our democracy by facilitating public discourse.” As access to social media platforms and their audiences becomes easier, and Google and Facebook’s market power has increased, trustworthy sources of news have declined.
A late-February live interview event, hosted by Our Hometown, a digital publishing platform and newspaper CMS, featured Paul Farrell Jr. and Bob Fitzsimmons, two of the lawyers leading the HD Media antitrust lawsuit. Fitzsimmons said 37 newspaper groups, or 227 individual newspapers, have joined the suit, and the lawyers are willing to represent newspapers across the U.S. that elect to file similar lawsuits.
In total, the legal coalition is suing the two tech giants for $37 billion, and if successful, the settlements could yield three times that number, the lawyers say. Facebook and Google’s combined annual revenues amount to more than $200 billion. Meanwhile, the HD Media lawsuit references the decline of newspaper advertising, from $49 billion in 2006 to $16.5 billion in 2017.
This effort is unique from other attempts to aid U.S. newspapers, said Lee Wolverton, vice president of news and executive editor at HD Media, during the February event. For example, the Local Journalism Sustainability Act, a bipartisan bill being considered by Congress, supports local media outlets through a series of three tax credits, which Wolverton said props up the industry with handouts. In contrast, this legal coalition strives to level the playing field, allowing newspapers to be sustainable — and thriving — on their own.
Last summer, the newspaper cases were consolidated in the Southern District of New York, the hope being that the attorney general will be sympathetic to the effort. In the online version of this story, a link to the complaint file is included. As of the Ink’s publication of this edition, the case is still pending with the court.
Sitting at the Scripps lecture last month and seeing these graduating seniors receive credit for the award-winning work they were already participating in, I felt a sense a pride for the journalism industry. Not necessarily for the outlets that thrive on one-sidedness like Fox News, CNN, and MSNBC, but for those daily, weekly, and monthly print and digital newspapers that are hanging on to the industry by their fingernails because they — we — believe in reporting the truth, rounding out stories with intel from multiple sides of a situation. The journalism industry is far from perfect, and as we advance in the digital age, how we deliver information to people may change, but what we deliver shouldn’t.
The first paragraph of the case file filed in January 2021 shares a quote that underscores why this lawsuit strikes to the heart of our United States of America:
“The basis of our governments being the opinion of the people, the very first object should be to keep that right; and were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.”
~ Thomas Jefferson, founding father and the third U.S. president
As the battle over not the freedom of the press, but the press, itself, wages, Moonshine Ink is joining the ranks. We’re signing on to join the 227 other newspapers seeking to destroy the monopolies of digital advertisement. To support us, and this cause, become a Moonshine Member at moonshineink.com/members.
P.S. To Facebook CEO Mark Zuckerberg, our Tahoe City neighbor: We do hope you’re reading Moonshine Ink, your local newspaper, and don’t hold against us our participation in this antitrust suit — we’re trying to survive. Perhaps you’d consider becoming a Moonshine Member to support independent and local journalism for one of your hometowns.
Find the full list of newspapers joining the antitrust lawsuit against Google and Facebook.
