Google faces CCI probe for denying news publishers fair share of advertising revenue

The order, posted on the competition regulator’s website, said that a prima facie case is made out against the alleged conduct of Google, which should be investigated. Google will have ample opportunity to present its side during the investigation. The watchdog has asked its Director General of Investigation to submit a report in 60 days. The regulator also said that nothing mentioned in its order is the final expression of opinion on the merits of the case.

The Digital News Publishers Association alleged in its petition that Google’s behavior resulted in news publishers being denied a fair share in digital advertising revenue and that insufficient information was disclosed to reach a proper resolution.

The petition said that the newspaper industry in India rests on a business model driven by advertising, which accounts for two-thirds of its total revenue and only one-third of the total revenue from subscriptions by readers. In addition, the digitization of the economy has resulted in higher spending on digital advertising, increasing the dependence of news publishers on digital advertising.

Google’s parent company Alphabet Inc. was sent an email on Saturday seeking comments for the story, which remained unanswered at the time of publication.

“The commission also takes note of developments in some countries, such as France and Australia, as referred to by The Informer (Digital News Publishers Association), that Google has been required to enter into fair/goodwill negotiations with news publishers for payment. stated. Licensing of content in order to address the imbalance of bargaining power between the two and the consequent imposition of unfair terms by Google. Undoubtedly, Google, being the gateway, generates substantial traffic for news publishers, but Also, the bargaining power imbalance and denial of fair share in the advertising revenue, as alleged by the informer, deserves detailed investigation,” the CCI said in its order.

The Digital News Publishers Association has said in its petition that its members engaged in the business of news media have attempted to provide credible and fact-checked news, which is the cornerstone of any democracy. The association said they have made and continue to invest large amounts of money in training their journalists and other executives, hiring journalists and investing in production. It also said that the media industry has been one of the hardest-hit sectors during the pandemic. It said the pandemic has accelerated the transition of consumers of news from traditional print and television media to digital channels.