A social symbolic moment

Ray Snoddy signals the start of Facebook News in the UK as a positive move but raises societal concerns on what else the tech giants are up to

The speed may have been glacial, but at long last we appear to have some modest measures to redress the huge imbalance between giant tech companies such as Facebook, and not just traditional publishers, but society itself.

Facebook is making its first serious effort to create a news section with properly verified information, sourced from professional publishers and has agreed to pay noticeable sums from January, which could reach into the very small millions.

The section due to launch in the UK within a matter of weeks will stand in contrast to its existing “news” feed created by Facebook users and containing, to be polite for a moment, information of a variable quality.

Most large newspapers in the UK, plus the main regional newspaper groups, have agreed to take part (Guardian Media group; regional newspaper giant JPI Media; and the Midland News Association to name three), as have papers like the Wall Street Journal and TV networks like ABC in the U.S, where it is already underway.

There will be “breaking news,” top ten stories and links to the UK publisher websites. Plus, in addition to the fees, which could reach £2 million over three years for the larger publishers, there could even be a boost to advertising sales.

Though welcome, the sums involved are hardly likely to replenish Covid-ravished revenues, or even replace more than a fraction of the sums extracted by Facebook from the advertising streams of publishers in the past.

It is however an important symbolic moment. It is a recognition that the tech giants cannot simply lift expensively produced editorial and then earn advertising revenue from it without compensation.

It could also lead to a wider, deeper relationship over time that could benefit both sides.

Interesting questions remain however. Who takes ultimate responsibility for what appears? Does this take Facebook further into the realms of being a publisher in its own right?

Almost certainly it does, even though third-party contractors, rather than Facebook employees, will be making the story selections.

The biggest question of all is, why has this deal surfaced now?

A suspicious mind would note that the California tech companies are facing more and more legal and legislative pressures on the grounds that they have used technology and financial muscle to build monopolies that make the oil and steel barons of the past look like amateurs.

By chance perhaps, the news deal coincided with belated action from the Digital, Culture, Media and Sports department – the long sought creation of a unit in the Competition and Markets Authority (CMA) to draw-up and enforce a code of practice covering the activities of Facebook and Amazon in the advertising market.

The Digital Markets Unit, to be set up by April – close to the speed of light in the regulatory universe – will enforce a new code to govern the behaviour of platforms “that currently dominate the market such as Google and Facebook.”

With so much going on the Government move has received relatively little attention but the CMA and its digital unit will have the power to “suspend, block or reverse” those actions that are deemed to affect unfairly competitors, small businesses and publishers.

The unit will be able to look at how the tech giants use or exploit personal data. It will also be given the power to impose financial penalties, although given the vast wealth of those involved, which has increased greatly on the back of a post-Trump U.S stock market boom, any penalty will never be more than a pinprick.

However late in the day, at least a conversation has been started, and governments around the world, not least in Australia, are making clear that they are not too fearful to act against the international power of the technology monopolies.

They might at least begin to engage and realise that not all their achievements are benign.

The worry is that so many things are happening simultaneously, and for all the modest steps forward such as the news agreement, the California giants are continuing to behave as they have always done – increasing their monopolies on an almost daily basis.

Despite considerable anti-trust attention, Facebook has just bid around $1 billion for yet another start-up, Kustomer, a New York company specialising in managing digital customer relationships.

Honestly, it amounts to sticking two fingers up to the regulators. The intention to acquire Kustomer comes as the U.S Federal Trade Commission and many individual American states are threatening to take action against just such behaviour.

Facebook has used its Stock Market purchasing power to buy-up anything that looks as if it might pose a competitive threat – more than 80 companies so far, including WhatsApp and Instagram.

If the Kustomer deal goes through, it will help Facebook increase its presence in e-commerce. And so it goes on, and will go on, until something is done by competition regulators.

In the face of a continuing stream of multi-million dollar acquisitions, agreements with news publishers that might at best bring in £2 million over three years to even the largest, seems little more than a distraction, a public relations exercise.

At the same time, and this is what makes any discussion about the overall impact of the tech giants so difficult, a Google subsidiary, Deepmind, has been making headlines around the world.

For a competition, the British artificial intelligence company successfully devised a program that can compute the shape of proteins. Scientists in the area of research have hailed the achievement as a once in 50 years breakthrough.

It could greatly speed-up the production of new medicines, not least in the field of virology.

Google’s role may have been to provide the funds and financial stability to help create such ground-breaking work, which could provide great benefits for humanity.

It might even win Google, or more precisely the employees in one of its subsidiaries, a Nobel prize.

And yet, at the same time such a development could undoubtedly increase Google’s power – this time in science and pharmaceuticals – around the world.

Once the protein project has been completed, another more challenging enigma is waiting for Deepmind. Why not use its AI expertise to plot the impact of the California tech giants on society, with particular reference to the media, advertising and communications industries.

What an achievement it would be if Deepmind could plot a way through the maze separating what is benign about their achievements from what is toxic and in need of urgent regulation.

Then meaningful action could at last be taken.