Stop the Presses? Newspapers in the Digital Age

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Stop the Presses? Newspapers in the
January January 2728, 2022 , 2022
Digital Age
Dana A. Scherer
During the last 20 years, more than 200 local daily newspapers have either reduced their During the last 20 years, more than 200 local daily newspapers have either reduced their
Specialist in Specialist in
publication frequency or ceased publishing altogether. Among those that survive, many employ a publication frequency or ceased publishing altogether. Among those that survive, many employ a
Telecommunications Telecommunications
fraction of the journalists that they did at the turn of the 21st century, and publish far fewer fraction of the journalists that they did at the turn of the 21st century, and publish far fewer
Policy Policy
original local and investigative news stories than they did previously. As a result, in order to get original local and investigative news stories than they did previously. As a result, in order to get

local news, thousands of U.S. communities rely on “ghost newspapers” that are shells of their local news, thousands of U.S. communities rely on “ghost newspapers” that are shells of their
Clare Y. Cho
former selves or, if they have internet service, on websites or chat groups that rarely employ full- former selves or, if they have internet service, on websites or chat groups that rarely employ full-
Analyst in Industrial Analyst in Industrial
time professional journalists. Among other societal effects, researchers report that the lack of a time professional journalists. Among other societal effects, researchers report that the lack of a
Organization and Business Organization and Business
daily newspaper to monitor local governments and publicly traded companies and hold them daily newspaper to monitor local governments and publicly traded companies and hold them

accountable can lead to increased financing costs to make up for investors’ lack of trust. accountable can lead to increased financing costs to make up for investors’ lack of trust.

Daily newspaper revenue, adjusted for inflation, has fallen approximately 80% since it peaked at Daily newspaper revenue, adjusted for inflation, has fallen approximately 80% since it peaked at
$89 billion in 2000. Several factors have led to the contraction of the newspaper industry, with the exception of large, $89 billion in 2000. Several factors have led to the contraction of the newspaper industry, with the exception of large,
national newspapers. Technological developments enabling citizens to access news without a subscription from websites and national newspapers. Technological developments enabling citizens to access news without a subscription from websites and
mobile apps have increased competition for readers. Revenue gains from online newspaper subscriptions have not replaced mobile apps have increased competition for readers. Revenue gains from online newspaper subscriptions have not replaced
revenues lost as subscriptions to print newspapers decline. In addition, a large share of advertising that formerly appeared in revenues lost as subscriptions to print newspapers decline. In addition, a large share of advertising that formerly appeared in
newspapers has shifted to online platforms. Likewise, for local and regional newspapers, revenues from online editions of newspapers has shifted to online platforms. Likewise, for local and regional newspapers, revenues from online editions of
newspapers have not replaced revenues lost from print editions. newspapers have not replaced revenues lost from print editions.
Business decisions by news aggregators such as Apple News and Google News and by social media platforms such as Business decisions by news aggregators such as Apple News and Google News and by social media platforms such as
Facebook also affect the viability of newspapers. As intermediaries between newspapers and their readers, these online Facebook also affect the viability of newspapers. As intermediaries between newspapers and their readers, these online
platforms can help increase newspapers’ readership. However, they can also impede the ability of newspapers to sell platforms can help increase newspapers’ readership. However, they can also impede the ability of newspapers to sell
subscriptions and collect data about their readers, which can be key to selling online advertising. subscriptions and collect data about their readers, which can be key to selling online advertising.
While some online platforms pay some newspapers for the right to distribute their articles, details about the agreements While some online platforms pay some newspapers for the right to distribute their articles, details about the agreements
between online platforms and newspapers typically are not publicly available. Some news aggregators and social media between online platforms and newspapers typically are not publicly available. Some news aggregators and social media
platforms distribute “snippets” (i.e., small portions) of articles without the copyright owner’s consent, claiming that they platforms distribute “snippets” (i.e., small portions) of articles without the copyright owner’s consent, claiming that they
consider snippets to be “fair use” of publishers’ content under the Copyright Act. In October 2021, the U.S. Copyright Office consider snippets to be “fair use” of publishers’ content under the Copyright Act. In October 2021, the U.S. Copyright Office
announced that, at the request of Congress, it is evaluating the effectiveness of current copyright protections for publishers in announced that, at the request of Congress, it is evaluating the effectiveness of current copyright protections for publishers in
the United States. The report is due in May 2022. the United States. The report is due in May 2022.
Authorities in several jurisdictions, including the U.S. antitrust agencies, the United Kingdom, Australia, the European Authorities in several jurisdictions, including the U.S. antitrust agencies, the United Kingdom, Australia, the European
Union, and several state attorneys general, have alleged or are investigating allegations that online platforms have engaged in Union, and several state attorneys general, have alleged or are investigating allegations that online platforms have engaged in
anticompetitive behavior in ways harmful to newspapers. Among other potential harms, the behavior could have potentially anticompetitive behavior in ways harmful to newspapers. Among other potential harms, the behavior could have potentially
impeded the ability of newspaper publishers to maximize their revenues from online advertising and subscription sales. In impeded the ability of newspaper publishers to maximize their revenues from online advertising and subscription sales. In
August 2021, the Judicial Panel on Multidistrict Litigation consolidated 20 suits against Google, including one filed by the August 2021, the Judicial Panel on Multidistrict Litigation consolidated 20 suits against Google, including one filed by the
attorneys general of 16 states and the Commonwealth of Puerto Rico. These lawsuits allege Google’s various roles in the attorneys general of 16 states and the Commonwealth of Puerto Rico. These lawsuits allege Google’s various roles in the
advertising buying and selling process enabled it to inhibit competition and, among other effects, divert revenue from advertising buying and selling process enabled it to inhibit competition and, among other effects, divert revenue from
newspaper publishers. newspaper publishers.
Members of the 117th Congress have introduced several bills intended to support newspaper publishers by amending antitrust Members of the 117th Congress have introduced several bills intended to support newspaper publishers by amending antitrust
law to allow news content creators to negotiate jointly with online content distributors (H.R. 1735; S. 673); by limiting the law to allow news content creators to negotiate jointly with online content distributors (H.R. 1735; S. 673); by limiting the
reach of online platforms (H.R. 3825); and by providing tax credits for employing local news journalists (H.R. 5376). The reach of online platforms (H.R. 3825); and by providing tax credits for employing local news journalists (H.R. 5376). The
Future of Local News Act of 2021 (H.R. 3169; S. 1601) would create the Future of Local News Committee to examine the Future of Local News Act of 2021 (H.R. 3169; S. 1601) would create the Future of Local News Committee to examine the
state of local news and make recommendations related to the ability of local news to meet information needs. Other state of local news and make recommendations related to the ability of local news to meet information needs. Other
congressional actions could eventually result from the Copyright Office study and pending litigation. congressional actions could eventually result from the Copyright Office study and pending litigation.
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Introduction
Digital communication has made it easier for individuals to access a wide range of information, Digital communication has made it easier for individuals to access a wide range of information,
including news and upcoming events, from multiple sources. For example, information about an including news and upcoming events, from multiple sources. For example, information about an
upcoming concert might be advertised in a local newspaper, posted on the performers’ website, upcoming concert might be advertised in a local newspaper, posted on the performers’ website,
and shared on social media. This digital transformation has changed the consumption and and shared on social media. This digital transformation has changed the consumption and
production of news and reduced revenues at local newspapers. production of news and reduced revenues at local newspapers.
Some Members of Congress have expressed concern about the decline of newspapers and have Some Members of Congress have expressed concern about the decline of newspapers and have
introduced bills to support newspapers and journalists. This report provides an overview of trends introduced bills to support newspapers and journalists. This report provides an overview of trends
in the newspaper industry, discusses newspapers’ relationships with online platforms,1 and in the newspaper industry, discusses newspapers’ relationships with online platforms,1 and
examines how the structure of online advertising affects newspapers’ funding. examines how the structure of online advertising affects newspapers’ funding.
Changing Patterns of News Consumption
The majority of Americans get at least some of their news—including content from newspapers—The majority of Americans get at least some of their news—including content from newspapers—
from digital devices, according to a 2020 survey conducted by the Pew Research Center.2 Among from digital devices, according to a 2020 survey conducted by the Pew Research Center.2 Among
online news sources, most age-groups preferred news websites and apps, but respondents aged 18 online news sources, most age-groups preferred news websites and apps, but respondents aged 18
to 29 listed social media platforms as their main source of news. In another 2020 survey, 14% of to 29 listed social media platforms as their main source of news. In another 2020 survey, 14% of
respondents cited daily printed newspapers as the principal medium from which they often get respondents cited daily printed newspapers as the principal medium from which they often get
news, compared with 23% citing social media sites (e.g., Facebook), 23% citing search engines news, compared with 23% citing social media sites (e.g., Facebook), 23% citing search engines
(e.g., Google), and 34% citing news websites or apps, including those operated by cable (e.g., Google), and 34% citing news websites or apps, including those operated by cable
television networks and local broadcast stationtelevision networks and local broadcast stations (Figure 1).

1 In this report, CRS uses the term “online platform” as defined by the Organisation for Economic Co-operation and 1 In this report, CRS uses the term “online platform” as defined by the Organisation for Economic Co-operation and
Development (OECD): “a digital service that facilitates interactions between two or more distinct but interdependent Development (OECD): “a digital service that facilitates interactions between two or more distinct but interdependent
sets of users (whether firms or individuals) who interact through the service via the internet.” Examples include search sets of users (whether firms or individuals) who interact through the service via the internet.” Examples include search
engines, social media, and app stores. Jeremy West, engines, social media, and app stores. Jeremy West, An Introduction to Online Platforms and Their Role in the Digital
Transformation (Paris: OECD, 2019), p. 20, at https://doi.org/10.1787/53e5f593-en. (Paris: OECD, 2019), p. 20, at https://doi.org/10.1787/53e5f593-en.
2 Elisa Shearer, “More Than Eight-in-Ten Americans Get News From Digital Devices,” Pew Research Center, January 2 Elisa Shearer, “More Than Eight-in-Ten Americans Get News From Digital Devices,” Pew Research Center, January
12, 2021, at https://www.pewresearch.org/fact-tank/2021/01/12/more-than-eight-in-ten-americans-get-news-from-12, 2021, at https://www.pewresearch.org/fact-tank/2021/01/12/more-than-eight-in-ten-americans-get-news-from-
digital-devices/. “Digital devices” refers to smartphones, computers, and tablets; Michael Barthel et al., “Measuring digital-devices/. “Digital devices” refers to smartphones, computers, and tablets; Michael Barthel et al., “Measuring
News Consumption in a Digital Era,” Pew Research Center, December 8, 2020, at https://www.pewresearch.org/News Consumption in a Digital Era,” Pew Research Center, December 8, 2020, at https://www.pewresearch.org/
journalism/wp-content/uploads/sites/8/2020/12/PJ_2020.12.08_News-Consumption_FINAL.pdf. journalism/wp-content/uploads/sites/8/2020/12/PJ_2020.12.08_News-Consumption_FINAL.pdf.
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Figure 1. News Consumption by Medium: 2020
Percentage of Respondents Who “Often” Get News from Each Media Platform Percentage of Respondents Who “Often” Get News from Each Media Platform

Source: Pew Research Center, “Journalism and Media: Datasets: American Trends Panel Wave 68,” at Pew Research Center, “Journalism and Media: Datasets: American Trends Panel Wave 68,” at
https://www.journalism.org/?post_type=dataset. Pew 2020 News Measurement Study. https://www.journalism.org/?post_type=dataset. Pew 2020 News Measurement Study.
Note: Results based on self-reported responses to survey questions. Results based on self-reported responses to survey questions.
Digitization of News
Newspapers have been offering their articles online since at least January 1994, when theNewspapers have been offering their articles online since at least January 1994, when the Palo
Alto Weekly published the first online newspaper.3 While some local print newspapers published the first online newspaper.3 While some local print newspapers
successfully made the transition to digital media, others struggled to adapt.4 successfully made the transition to digital media, others struggled to adapt.4
Digital media has changed the way news is distributed. While daily print newspapers are released Digital media has changed the way news is distributed. While daily print newspapers are released
only at set times, online news content can be added and updated continuously throughout the only at set times, online news content can be added and updated continuously throughout the
day.5 News content posted online can be produced and disseminated quickly; one study found that day.5 News content posted online can be produced and disseminated quickly; one study found that
one-quarter of news content posted on one site would be posted on another site within four one-quarter of news content posted on one site would be posted on another site within four
minutes.6 News publishers that started in other forms of media, such as television broadcasting minutes.6 News publishers that started in other forms of media, such as television broadcasting
and radio, started offering their content online.7 The emergence of digital-native newspapers8 and radio, started offering their content online.7 The emergence of digital-native newspapers8

3 Sacha Wunch-Vincent and Graham Vickery, 3 Sacha Wunch-Vincent and Graham Vickery, The Evolution of News and the Internet, OECD Working Party on the , OECD Working Party on the
Information Economy, Paris, June 11, 2010, p. 8, at https://www.oecd.org/sti/ieconomy/Information Economy, Paris, June 11, 2010, p. 8, at https://www.oecd.org/sti/ieconomy/
oecdexaminesthefutureofnewsandtheinternet.htm. (OECD June 2010 Report.) oecdexaminesthefutureofnewsandtheinternet.htm. (OECD June 2010 Report.)
4 Damian Radcliffe and Christopher Ali, 4 Damian Radcliffe and Christopher Ali, Small-Market Newspapers in the Digital Age, Tow Center for Journalism, , Tow Center for Journalism,
Columbia University, New York, NY, November 15, 2017, at https://academiccommons.columbia.edu/Columbia University, New York, NY, November 15, 2017, at https://academiccommons.columbia.edu/
doi/10.7916/D8WS95VQ. doi/10.7916/D8WS95VQ.
5 Bertin Martens et al., “The Digital Transformation of News Media and the Rise of Disinformation and Fake News,” 5 Bertin Martens et al., “The Digital Transformation of News Media and the Rise of Disinformation and Fake News,”
European Commission, Joint Research Centre Technical Report Working Paper 2018-02, April 2018, at European Commission, Joint Research Centre Technical Report Working Paper 2018-02, April 2018, at
https://ec.europa.eu/jrc/sites/default/files/jrc111529.pdf. https://ec.europa.eu/jrc/sites/default/files/jrc111529.pdf.
6 Julia Cage, Nicolas Hervé, and Marie-Luce Viaud, “The Production of Information in an Online World,” 6 Julia Cage, Nicolas Hervé, and Marie-Luce Viaud, “The Production of Information in an Online World,” Review of
Economic Studies, vol. 87, issue 5 (October 2020), pp. 2126-2164. , vol. 87, issue 5 (October 2020), pp. 2126-2164.
7 For example, National Public Radio started as a network of public radio stations and Fox News started as a cable 7 For example, National Public Radio started as a network of public radio stations and Fox News started as a cable
television news channel; both now publish content on their own websites and apps as well. television news channel; both now publish content on their own websites and apps as well.
8 This report uses the term “digital-native news publishers” to refer to news publishers that only offer their content 8 This report uses the term “digital-native news publishers” to refer to news publishers that only offer their content
online or those that started online; some may also be referred to as “online media companies” or other similar terms. online or those that started online; some may also be referred to as “online media companies” or other similar terms.
Some of these publishers specialize in specific subject areas (e.g., Some of these publishers specialize in specific subject areas (e.g., TechCrunch, which focuses on the tech industry and , which focuses on the tech industry and
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further increased the number of outlets providing news, some of which became substitutes for further increased the number of outlets providing news, some of which became substitutes for
print newspapers.9 print newspapers.9
The digitization of news can affect local news coverage. Some news publishers may not have an The digitization of news can affect local news coverage. Some news publishers may not have an
incentive to report on all topics covered by local newspapers. Publishers may not have an incentive to report on all topics covered by local newspapers. Publishers may not have an
incentive to conduct in-depth investigations of local affairs, which can be costly and time-incentive to conduct in-depth investigations of local affairs, which can be costly and time-
consuming, if they are unlikely to increase the number of subscribers.10 In addition, some consuming, if they are unlikely to increase the number of subscribers.10 In addition, some
newspapers have been able to attract readers from across the country by selling subscriptions to newspapers have been able to attract readers from across the country by selling subscriptions to
their digital products.11 This can adversely affect smaller, local newspapers that lack the resources their digital products.11 This can adversely affect smaller, local newspapers that lack the resources
to create digital products, potentially affecting engagement with local issues. to create digital products, potentially affecting engagement with local issues.
Newspaper Revenue Trends
Traditionally, the primary revenue sources of daily print newspaper publishers have been print Traditionally, the primary revenue sources of daily print newspaper publishers have been print
subscriptions and print advertising. subscriptions and print advertising.
Daily newspaper revenue, adjusted for inflation, has fallen approximately 80% since it peaked at Daily newspaper revenue, adjusted for inflation, has fallen approximately 80% since it peaked at
$89 billion in 2000. The share of newspaper publishers’ revenue derived from online advertising, $89 billion in 2000. The share of newspaper publishers’ revenue derived from online advertising,
adjusted for inflation, has increased over the last 20 years, from 2.6% in 2004 ($2 billion out of a adjusted for inflation, has increased over the last 20 years, from 2.6% in 2004 ($2 billion out of a
total of $46.2 billion in 2020 dollars) to 35.4% in 2020 ($3 billion out of a total of $9.3 billion). total of $46.2 billion in 2020 dollars) to 35.4% in 2020 ($3 billion out of a total of $9.3 billion).
Thus, advertising revenues from newspapers’ websites and apps have grown in importance, but Thus, advertising revenues from newspapers’ websites and apps have grown in importance, but
not by enough to prevent a sharp overall decline in industry revenues.not by enough to prevent a sharp overall decline in industry revenues.
The few daily newspapers with a national and/or international readership, such as the The few daily newspapers with a national and/or international readership, such as the New York
Times, the , the Wall Street Journal, , USA Today, and the , and the Washington Post, have experienced different , have experienced different
advertising trends than those with a local or regional readership. As journalism professor advertising trends than those with a local or regional readership. As journalism professor
Penelope Muse Abernathy wrote in a June 2020 report, national newspapers “have a journalistic Penelope Muse Abernathy wrote in a June 2020 report, national newspapers “have a journalistic
mandate and a business model, which rely on scale and reach, that are very different from that of mandate and a business model, which rely on scale and reach, that are very different from that of
either the state and metro papers or smaller community papers.”12 This scale and reach enable the either the state and metro papers or smaller community papers.”12 This scale and reach enable the
national papers to attract national advertisers in addition to local advertisers, and thereby generate national papers to attract national advertisers in addition to local advertisers, and thereby generate
more online advertising revenue than their local counterparts.13 In addition, as described below, more online advertising revenue than their local counterparts.13 In addition, as described below,

start-up companies), while others provide broader coverage of national events (e.g., start-up companies), while others provide broader coverage of national events (e.g., Business Insider, , HuffPost, and , and
Breitbart). ).
9 Matthew Gentzkow, “Valuing New Goods in a Model with Complementarity: Online Newspapers,” 9 Matthew Gentzkow, “Valuing New Goods in a Model with Complementarity: Online Newspapers,” American
Economic Review, vol. 97, no. 3 (2007), pp. 713-744; John Dimmick, Yan Chen, and Zhan Li, “Competition Between , vol. 97, no. 3 (2007), pp. 713-744; John Dimmick, Yan Chen, and Zhan Li, “Competition Between
the Internet and Traditional News Media: The Gratification-Opportunities Niche Dimension,” the Internet and Traditional News Media: The Gratification-Opportunities Niche Dimension,” Journal of Media
Economics, vol. 17, no. 1 (2004), pp. 19-33. , vol. 17, no. 1 (2004), pp. 19-33.
10 Stigler Committee on Digital Platforms, “Final Report: News Industry Subcommittee Report,” Chicago Booth Stigler 10 Stigler Committee on Digital Platforms, “Final Report: News Industry Subcommittee Report,” Chicago Booth Stigler
Center, 2019, at https://research.chicagobooth.edu/stigler/media/news/committee-on-digital-platforms-final-report, pp. Center, 2019, at https://research.chicagobooth.edu/stigler/media/news/committee-on-digital-platforms-final-report, pp.
139-205; Bertin Martens et al., “The Digital Transformation of News Media and the Rise of Disinformation and Fake 139-205; Bertin Martens et al., “The Digital Transformation of News Media and the Rise of Disinformation and Fake
News,” European Commission, Joint Research Centre Technical Report Working Paper 2018-02, April 2018, at News,” European Commission, Joint Research Centre Technical Report Working Paper 2018-02, April 2018, at
https://ec.europa.eu/jrc/sites/default/files/jrc111529.pdf. https://ec.europa.eu/jrc/sites/default/files/jrc111529.pdf.
11 For example, see Lisa George and Joel Waldfogel, “The 11 For example, see Lisa George and Joel Waldfogel, “The New York Times and the Market for Local Newspapers,” and the Market for Local Newspapers,”
American Economic Review, vol. 96, no. 1 (2006), pp. 435-447. , vol. 96, no. 1 (2006), pp. 435-447.
12 Penelope Abernathy, 12 Penelope Abernathy, News Deserts and Ghost Newspapers: Will Local News Survive?, Center for Innovation and , Center for Innovation and
Sustainability in Local Media, University of North Carolina at Chapel Hill, June 2020, p. 13, at Sustainability in Local Media, University of North Carolina at Chapel Hill, June 2020, p. 13, at
https://www.usnewsdeserts.com/reports/news-deserts-and-ghost-newspapers-will-local-news-survive/ (Abernathy June https://www.usnewsdeserts.com/reports/news-deserts-and-ghost-newspapers-will-local-news-survive/ (Abernathy June
2020 Report). The New York Times Company 2020 Annual Report, p. 4 (NYT 2020 Annual Report). 2020 Report). The New York Times Company 2020 Annual Report, p. 4 (NYT 2020 Annual Report).
13 According to Thomas Hunter, chairman and CEO of group newspaper owner McClatchy, national advertisers, in 13 According to Thomas Hunter, chairman and CEO of group newspaper owner McClatchy, national advertisers, in
order to reach readers nationwide, prefer to negotiate a “seamless and turnkey” arrangement, rather than engage in order to reach readers nationwide, prefer to negotiate a “seamless and turnkey” arrangement, rather than engage in
multiple negotiations with various local newspaper publishers. Sarah Fischer, “Gannett, McClatchy Team Up to Sell multiple negotiations with various local newspaper publishers. Sarah Fischer, “Gannett, McClatchy Team Up to Sell
Ads,” Ads,” Axios, February 15, 2021, at https://www.axios.com/gannett-mcclatchy-advertising-sales-local-f87fa8db-cc60-, February 15, 2021, at https://www.axios.com/gannett-mcclatchy-advertising-sales-local-f87fa8db-cc60-
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large publishers are less reliant on advertising technology intermediaries such as Google,14 and large publishers are less reliant on advertising technology intermediaries such as Google,14 and
are therefore able to retain a greater share of online advertising revenues than small publishers. are therefore able to retain a greater share of online advertising revenues than small publishers.
In 2020, for example, the In 2020, for example, the New York Times generated approximately 58% of its advertising generated approximately 58% of its advertising
revenue from online advertising.15 In contrast, for three leading publishers of local daily revenue from online advertising.15 In contrast, for three leading publishers of local daily
newspapers, Lee Enterprises Inc., DallasNews Corp., and Tribune Publishing Company, the newspapers, Lee Enterprises Inc., DallasNews Corp., and Tribune Publishing Company, the
proportions of total advertising revenue generated by online advertising in 2020 were 36.8%,16 proportions of total advertising revenue generated by online advertising in 2020 were 36.8%,16
35.9%,17 and 27%,18 respectively. 35.9%,17 and 27%,18 respectively.
Figure 2. Sources of Daily Newspaper Industry Revenue
Figures in $ Billions, Adjusted for Inflation in 2020 Dollars Figures in $ Billions, Adjusted for Inflation in 2020 Dollars

Source: CRS analysis of data from S&P Global Market Intelligence. Inflation adjustment based on Bureau of CRS analysis of data from S&P Global Market Intelligence. Inflation adjustment based on Bureau of
Labor Statistics Consumer Price Index for All Urban Consumers. Labor Statistics Consumer Price Index for All Urban Consumers.
Notes: Advertising revenue includes both national and local advertising. In nominal terms, newspaper publishers Advertising revenue includes both national and local advertising. In nominal terms, newspaper publishers
generated $48.2 bil ion in 2004. generated $48.2 bil ion in 2004.

4bf6-9ea4-a8b033d6aa52.html. 4bf6-9ea4-a8b033d6aa52.html.
14 In 2015, Google reorganized and formed a new parent organization, Alphabet. Alphabet’s core businesses, including 14 In 2015, Google reorganized and formed a new parent organization, Alphabet. Alphabet’s core businesses, including
search and advertising, operate under the umbrella of the Google brand. See “Larry’s Alphabet Letter,” Founders’ search and advertising, operate under the umbrella of the Google brand. See “Larry’s Alphabet Letter,” Founders’
Letters (blog), August 10, 2015, at https://abc.xyz/investor/founders-letters/2015/. See also Google, “About,” at Letters (blog), August 10, 2015, at https://abc.xyz/investor/founders-letters/2015/. See also Google, “About,” at
https://about.google/. https://about.google/.
15 New York Times Company, SEC Form 10-K for the fiscal year ended December 27, 2020, p. 3. (NYT 2020 SEC 15 New York Times Company, SEC Form 10-K for the fiscal year ended December 27, 2020, p. 3. (NYT 2020 SEC
Form10-K). Form10-K).
16 Lee Enterprises Inc., SEC Form 10-K for the fiscal year ended September 27, 2020, p. 20. (Lee 2020 SEC Form 10- 16 Lee Enterprises Inc., SEC Form 10-K for the fiscal year ended September 27, 2020, p. 20. (Lee 2020 SEC Form 10-
K.) K.)
17 A.H. Belo Corporation, SEC Form 10-K for the fiscal year ended December 31, 2020, p. 13 (DallasNews 2020 SEC 17 A.H. Belo Corporation, SEC Form 10-K for the fiscal year ended December 31, 2020, p. 13 (DallasNews 2020 SEC
Form 10-K). In June 2021, the company changed its name from A.H. Belo Corporation to DallasNews Corporation. Form 10-K). In June 2021, the company changed its name from A.H. Belo Corporation to DallasNews Corporation.
18 Tribune Publishing Company, SEC Form 10-K, p. F-21 (Tribune SEC Form 10-K). Tribune ceased to be a publicly 18 Tribune Publishing Company, SEC Form 10-K, p. F-21 (Tribune SEC Form 10-K). Tribune ceased to be a publicly
traded company in 2021, when hedge firm Alden Global Capital purchased the company. traded company in 2021, when hedge firm Alden Global Capital purchased the company.
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Online Competition for Local Advertising
The internet transformed the local advertising market for newspapers, unleashing competition The internet transformed the local advertising market for newspapers, unleashing competition
from online platforms and websites. The launch of the free online classified advertising website from online platforms and websites. The launch of the free online classified advertising website
Craigslist in 199619 coincided with the falloff in newspapers’ revenue from print classified Craigslist in 199619 coincided with the falloff in newspapers’ revenue from print classified
advertising. In addition, some newspaper publishers themselves invested in online classified advertising. In addition, some newspaper publishers themselves invested in online classified
services such as Cars.com, Apartments.com, Autotrader.com, and CareerBuilder, which siphoned services such as Cars.com, Apartments.com, Autotrader.com, and CareerBuilder, which siphoned
off classified advertising from newspapers.20 off classified advertising from newspapers.20
In 2000, print newspapers generated 40% of their local advertising, or $19.6 billion, from In 2000, print newspapers generated 40% of their local advertising, or $19.6 billion, from
classified ads. In 2020, print classified advertising generated only 15% of total advertising classified ads. In 2020, print classified advertising generated only 15% of total advertising
revenue, or $1.4 billion.21 revenue, or $1.4 billion.21
Likewise, display advertisers, such as retailers and consumer products manufacturers, shifted Likewise, display advertisers, such as retailers and consumer products manufacturers, shifted
their budgets from print newspapers to online platforms and websites as the internet enabled them their budgets from print newspapers to online platforms and websites as the internet enabled them
to target potential customers in new ways.22 Newspapers typically offer the same advertisement to to target potential customers in new ways.22 Newspapers typically offer the same advertisement to
all print readers. In contrast, online platforms, particularly Google and Facebook, can target ads all print readers. In contrast, online platforms, particularly Google and Facebook, can target ads
precisely to potential consumers based on the platforms’ access to data about individuals.23 precisely to potential consumers based on the platforms’ access to data about individuals.23
According to estimates from research firms Borrell Associates and eMarketer, as of 2019, Google According to estimates from research firms Borrell Associates and eMarketer, as of 2019, Google
and Facebook collectively received 77% of online advertising revenue in local markets.24 In and Facebook collectively received 77% of online advertising revenue in local markets.24 In
particular, these two companies benefited from a self-reinforcing cycle of attracting users and particular, these two companies benefited from a self-reinforcing cycle of attracting users and
advertisers. The more users they attract, the more data they can collect, and the easier it is to advertisers. The more users they attract, the more data they can collect, and the easier it is to
target the users with advertisements, thereby enabling them to maintain a competitive advantage target the users with advertisements, thereby enabling them to maintain a competitive advantage
vis-à-vis other online media outlets in generating advertising revenues. vis-à-vis other online media outlets in generating advertising revenues.
A As Figure 3 illustrates, printed daily newspapers’ share of overall local advertising25 spending illustrates, printed daily newspapers’ share of overall local advertising25 spending
plummeted, from plummeted, from 4841.9% of $% of $~~109~~92.1 billion in total local advertising spending in 2004 (in billion in total local advertising spending in 2004 (in ~~2020~~ nominal dollars) dollars)
to 5% of the $to 5% of the $9593.0 billion in total local advertising spending in 2020. In contrast, the share of local billion in total local advertising spending in 2020. In contrast, the share of local
advertising spending captured by online media—which, as shown advertising spending captured by online media—which, as shown inin Figure 3 includes includes
advertising revenue from all websites and apps (including newspaper websites and apps)—advertising revenue from all websites and apps (including newspaper websites and apps)—
skyrocketed from 3% in 2004 to 63% in 2020. Thus, while newspaper publishers rely on online skyrocketed from 3% in 2004 to 63% in 2020. Thus, while newspaper publishers rely on online
platforms to reach readers and advertisers, the publishers also compete with those platforms, platforms to reach readers and advertisers, the publishers also compete with those platforms,
either directly or indirectly, for access to their readers’ data and revenues from local advertisers either directly or indirectly, for access to their readers’ data and revenues from local advertisers
seeking to utilize those data. seeking to utilize those data.

19 Beth Daley, “Craigslist Turns 25—a Reminder That a More Democratic Version of the Internet Can Still Thrive,” 19 Beth Daley, “Craigslist Turns 25—a Reminder That a More Democratic Version of the Internet Can Still Thrive,”
The Conversation, February 19, 2020, at https://theconversation.com/craigslist-turns-25-a-reminder-that-a-more-, February 19, 2020, at https://theconversation.com/craigslist-turns-25-a-reminder-that-a-more-
democratic-version-of-the-internet-can-still-thrive-129875. Craigslist began as an democratic-version-of-the-internet-can-still-thrive-129875. Craigslist began as an ~~e-mail~~email listserv in 1995. listserv in 1995.
20 Craig Shafer, “Don’t Blame Craigslist for the Decline of Newspapers,” 20 Craig Shafer, “Don’t Blame Craigslist for the Decline of Newspapers,” Politico, December 13, 2016, at , December 13, 2016, at
https://www.politico.com/magazine/story/2016/12/craigslist-newspapers-decline-classifieds-214525/. https://www.politico.com/magazine/story/2016/12/craigslist-newspapers-decline-classifieds-214525/.
21 CRS analysis of data from S&P Global Market Intelligence. Figures not adjusted for inflation. 21 CRS analysis of data from S&P Global Market Intelligence. Figures not adjusted for inflation.
22 Display advertisements are “displayed” alongside editorial content. They often contain graphics or other artwork to 22 Display advertisements are “displayed” alongside editorial content. They often contain graphics or other artwork to
promote products and/or services. promote products and/or services.
23 “Digital Versus Traditional Marketing: What Today’s C-Suite Needs to Know,” Wharton Online (blog), University 23 “Digital Versus Traditional Marketing: What Today’s C-Suite Needs to Know,” Wharton Online (blog), University
of Pennsylvania, July 17, 2019, at https://online.wharton.upenn.edu/blog/digital-versus-traditional-marketing/. of Pennsylvania, July 17, 2019, at https://online.wharton.upenn.edu/blog/digital-versus-traditional-marketing/.
24 Keach Hagey, Lukas I. Alpert, and Yaryna Serkez, “In the News Industry, a Stark Divide Between the Haves and 24 Keach Hagey, Lukas I. Alpert, and Yaryna Serkez, “In the News Industry, a Stark Divide Between the Haves and
Have-Nots,”Have-Nots,” Wall Street Journal, May 4, 2019, at https://www.wsj.com/graphics/local-newspapers-stark-divide/. , May 4, 2019, at https://www.wsj.com/graphics/local-newspapers-stark-divide/.
25 “Local advertising” refers to the way in which advertising is purchased/sold. Local advertising is purchased/sold on a 25 “Local advertising” refers to the way in which advertising is purchased/sold. Local advertising is purchased/sold on a
per-market basis; national advertising is sold across the entire country. per-market basis; national advertising is sold across the entire country. ~~E-mail~~Email dated December 2, 2021, from S&P dated December 2, 2021, from S&P
Global Market Intelligence to CRS. Global Market Intelligence to CRS.
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Figure 3. Local Advertising Revenue Shares by Medium
Figures in $ Billions, Adjust for Inflation in 2020 Dollars Figures in $ Billions, Adjust for Inflation in 2020 Dollars

Source: CRS analysis of data from S&P Global Market Intelligence and Bureau of Labor Statistics Consumer CRS analysis of data from S&P Global Market Intelligence and Bureau of Labor Statistics Consumer
Price Index for All Urban Consumers. Price Index for All Urban Consumers.
Notes: Here, “Online” includes advertising revenues generated by advertising over the internet and over Here, “Online” includes advertising revenues generated by advertising over the internet and over
mobile, including the websites and mobile apps of daily newspapers. “Other” includes advertising revenues mobile, including the websites and mobile apps of daily newspapers. “Other” includes advertising revenues
generated by broadcast television stations, regional cable (sports) networks, cable and satellite operators, generated by broadcast television stations, regional cable (sports) networks, cable and satellite operators,
newspapers/shoppers distributed weekly, yellow pages, and outdoor/out-of-home advertising. newspapers/shoppers distributed weekly, yellow pages, and outdoor/out-of-home advertising.
Effects of Revenue Declines
The decline in industry revenue (even without adjusting for inflation) has contributed to the The decline in industry revenue (even without adjusting for inflation) has contributed to the
closure of hundreds of newspapers and reductions in publication frequencies for others, and/or closure of hundreds of newspapers and reductions in publication frequencies for others, and/or
staff layoffs. According to one count, between 2004 and 2020, 71 daily newspapers in the United staff layoffs. According to one count, between 2004 and 2020, 71 daily newspapers in the United
States ceased publication, including many in economically troubled communities where States ceased publication, including many in economically troubled communities where
advertisers were struggling and readers could no longer afford subscriptions.26 During that same advertisers were struggling and readers could no longer afford subscriptions.26 During that same
period, more than 100 daily newspapers reduced their publication frequency to less than seven period, more than 100 daily newspapers reduced their publication frequency to less than seven
days per week.27 The widespread economic and social impact of the Coronavirus Disease 2019 days per week.27 The widespread economic and social impact of the Coronavirus Disease 2019
(COVID-19) pandemic in 2020 led to a further decline in the number of daily newspapers, as (COVID-19) pandemic in 2020 led to a further decline in the number of daily newspapers, as
advertisers cut back spending.28 In July 2020, Wyoming became the first state without a daily advertisers cut back spending.28 In July 2020, Wyoming became the first state without a daily
printed newspaper on Monday mornings.29 printed newspaper on Monday mornings.29

26 Abernathy June 2020 Report, p. 15. 26 Abernathy June 2020 Report, p. 15.
27 Christine Schmidt, “How Publishers Are Cutting Print Days—and Not Losing Too Many Subscribers,” Nieman Lab, 27 Christine Schmidt, “How Publishers Are Cutting Print Days—and Not Losing Too Many Subscribers,” Nieman Lab,
August 28, 2019, at https://www.niemanlab.org/2019/08/how-publishers-are-cutting-print-days-and-not-losing-too-August 28, 2019, at https://www.niemanlab.org/2019/08/how-publishers-are-cutting-print-days-and-not-losing-too-
many-subscribers/. many-subscribers/.
28 Erika Bolstad, “COVID-19 Is Crushing Newspapers, Worsening Hunger for Accurate Information,” Pew Charitable 28 Erika Bolstad, “COVID-19 Is Crushing Newspapers, Worsening Hunger for Accurate Information,” Pew Charitable
Trusts, September 8, 2020, at https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2020/09/08/covid-19-Trusts, September 8, 2020, at https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2020/09/08/covid-19-
is-crushing-newspapers-worsening-hunger-for-accurate-information. is-crushing-newspapers-worsening-hunger-for-accurate-information.
29 Joshua Benton, “Want to Read a Local Newspaper on a Monday Morning in Wyoming? The Last One Printing Is 29 Joshua Benton, “Want to Read a Local Newspaper on a Monday Morning in Wyoming? The Last One Printing Is
About to Stop,” Nieman Lab, July 15, 2020, at https://www.niemanlab.org/2020/07/want-to-read-a-local-newspaper-About to Stop,” Nieman Lab, July 15, 2020, at https://www.niemanlab.org/2020/07/want-to-read-a-local-newspaper-
on-a-monday-morning-in-wyoming-the-last-one-still-printing-is-about-to-stop. on-a-monday-morning-in-wyoming-the-last-one-still-printing-is-about-to-stop.
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Meanwhile, ownership of the surviving newspapers has become more concentrated. From 2004 to Meanwhile, ownership of the surviving newspapers has become more concentrated. From 2004 to
2020, the percentage of daily newspapers owned by the 25 largest newspaper publishers grew 2020, the percentage of daily newspapers owned by the 25 largest newspaper publishers grew
from less than a third of the 1,472 dailies (including newspapers that have since decreased their from less than a third of the 1,472 dailies (including newspapers that have since decreased their
publication frequency to weekly as well as those that since ceased publication) to more than to publication frequency to weekly as well as those that since ceased publication) to more than to
70% of the 1,260 dailies.30 The new owners, in many cases private equity firms, hedge funds, or 70% of the 1,260 dailies.30 The new owners, in many cases private equity firms, hedge funds, or
other investment groups, took on debt to acquire the newspapers, and promised investors that they other investment groups, took on debt to acquire the newspapers, and promised investors that they
would earn a return on their investments by cutting costs.31 In some instances, such cost cutting would earn a return on their investments by cutting costs.31 In some instances, such cost cutting
has involved selling real estate and equipment and laying off employees.32 has involved selling real estate and equipment and laying off employees.32
From 2004 to 2020, the total number of employees at newspapers declined from about 397,500 to From 2004 to 2020, the total number of employees at newspapers declined from about 397,500 to
120,000 120,000 (Figure 4). These figures include people working at newspaper websites. Meanwhile, the . These figures include people working at newspaper websites. Meanwhile, the
total number of employees working for “Internet publishing and broadcasting and search portals,” total number of employees working for “Internet publishing and broadcasting and search portals,”
the best proxy for online-only publishers, rose from about 66,100 to 290,200.33 Thus, while the best proxy for online-only publishers, rose from about 66,100 to 290,200.33 Thus, while
online-only publishers have siphoned off advertising revenue from newspapers, they employ far online-only publishers have siphoned off advertising revenue from newspapers, they employ far
fewer journalists. fewer journalists.
The Bureau of Labor Statistics estimates that of the 46,700 news analysts, reporters, and The Bureau of Labor Statistics estimates that of the 46,700 news analysts, reporters, and
journalists employed nationwide in 2020, about 13,800 (29.6%) were employed by newspaper journalists employed nationwide in 2020, about 13,800 (29.6%) were employed by newspaper
publishers, roughly the same number employed by television broadcasters. About 6,100 (or publishers, roughly the same number employed by television broadcasters. About 6,100 (or
13.2%) were self-employed, and about 4,900 (or 10.6%) were employed by other online-only 13.2%) were self-employed, and about 4,900 (or 10.6%) were employed by other online-only
publishers.34 Thus, despite their declining revenues, newspaper publishers continue to employ publishers.34 Thus, despite their declining revenues, newspaper publishers continue to employ
more people within this job category than their online counterparts. more people within this job category than their online counterparts.

30 Abernathy June 2020 Report, pp. 34-35. 30 Abernathy June 2020 Report, pp. 34-35.
31 Anna Nicolau and James Fontanella-Khan, “The Fight for the Future of America’s Local Newspapers,” 31 Anna Nicolau and James Fontanella-Khan, “The Fight for the Future of America’s Local Newspapers,” Financial
Times, January 21, 2021, at https://www.ft.com/content/5c22075c-f1af-431d-bf39-becf9c54758b. , January 21, 2021, at https://www.ft.com/content/5c22075c-f1af-431d-bf39-becf9c54758b.
32 McKay Coppins, “A Secretive Hedge Fund Is Gutting Newsrooms,” 32 McKay Coppins, “A Secretive Hedge Fund Is Gutting Newsrooms,” The Atlantic, October 14, 2021, at , October 14, 2021, at
https://www.theatlantic.com/magazine/archive/2021/11/alden-global-capital-killing-americas-newspapers/620171/. https://www.theatlantic.com/magazine/archive/2021/11/alden-global-capital-killing-americas-newspapers/620171/.
33 Bureau of Labor Statistics, Current Employment Statistics, employment for NAICS code 51913, at 33 Bureau of Labor Statistics, Current Employment Statistics, employment for NAICS code 51913, at
https://www.bls.gov/ces/data/. https://www.bls.gov/ces/data/.
34 U.S. Bureau of Labor Statistics, “Data Tools; Employment Projections; National Employment Matrix; 27-3023 News 34 U.S. Bureau of Labor Statistics, “Data Tools; Employment Projections; National Employment Matrix; 27-3023 News
Analysts, Reporters, and Journalists; Employment by Industry, Occupation, and Percent Distribution, 2020 and Analysts, Reporters, and Journalists; Employment by Industry, Occupation, and Percent Distribution, 2020 and
Projected 2030,” at https://data.bls.gov/projections/nationalMatrix?queryParams=27-3023&ioType=o. Projected 2030,” at https://data.bls.gov/projections/nationalMatrix?queryParams=27-3023&ioType=o.
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Figure 4. Newspaper and Online-Only Publishing Employment Trends
Average Monthly Employment Average Monthly Employment

Source: Bureau of Labor Statistics; “Current Employment Statistics National Databases, Multiscreen, Bureau of Labor Statistics; “Current Employment Statistics National Databases, Multiscreen,
Information (NACIS Code 50); All Employees, Thousands; Newspaper Publishers (NAICS Code 51111) and Information (NACIS Code 50); All Employees, Thousands; Newspaper Publishers (NAICS Code 51111) and
Internet Publishing and Broadcasting and Web Search Portals (NAICS Code 51913); from years 2004–2021, Internet Publishing and Broadcasting and Web Search Portals (NAICS Code 51913); from years 2004–2021,
including monthly averages,” at https://www.bls.gov/ces/data/. including monthly averages,” at https://www.bls.gov/ces/data/.
Notes: Figures not seasonally adjusted. 2021 data are employment averages of figures from January–November. Figures not seasonally adjusted. 2021 data are employment averages of figures from January–November.
Researchers have found evidence that local newspaper closures and/or employee layoffs can Researchers have found evidence that local newspaper closures and/or employee layoffs can
increase the financing costs of both local governments and private corporations. A study increase the financing costs of both local governments and private corporations. A study
published in 2020 found that because “local newspapers hold their governments accountable, published in 2020 found that because “local newspapers hold their governments accountable,
keeping municipal borrowing costs low and ultimately saving local taxpayers money,” closures keeping municipal borrowing costs low and ultimately saving local taxpayers money,” closures
can “have a significantly adverse impact on municipal borrowing costs in the long run.”35 can “have a significantly adverse impact on municipal borrowing costs in the long run.”35
Likewise, a study published in 2021 found that newspapers play an important role in enabling Likewise, a study published in 2021 found that newspapers play an important role in enabling
shareholders to monitor monitoring publicly traded firms.36 shareholders to monitor monitoring publicly traded firms.36

35 Pengjie Gao, Chang Lee, and Dermot Murphy, “Financing Dies in Darkness? The Impact of Newspaper Closures on 35 Pengjie Gao, Chang Lee, and Dermot Murphy, “Financing Dies in Darkness? The Impact of Newspaper Closures on
Public Finance,” Public Finance,” Journal of Financial Economics, vol. 135, no. 2 (2020), p. 445. , vol. 135, no. 2 (2020), p. 445.
36 Min Kim, Derrald Stice, Han Stice, and Roger M. White, “Stop the Presses! Or Wait, We Might Need Them: Firm 36 Min Kim, Derrald Stice, Han Stice, and Roger M. White, “Stop the Presses! Or Wait, We Might Need Them: Firm
Responses to Local Newspaper Closures and Layoffs,” Responses to Local Newspaper Closures and Layoffs,” Journal of Corporate Finance, v. 69 (2021), p. 102035, at , v. 69 (2021), p. 102035, at
https://www.sciencedirect.com/science/article/pii/S0929119921001577?via%3Dihub. https://www.sciencedirect.com/science/article/pii/S0929119921001577?via%3Dihub.
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Newspaper Publishers’ Relationship with
Online Platforms
Some online platforms allow consumers to access news articles, or portions of news articles, Some online platforms allow consumers to access news articles, or portions of news articles,
without a direct subscription to the newspaper. This section discusses how two types of online without a direct subscription to the newspaper. This section discusses how two types of online
platforms—news aggregators and social media platforms—can both benefit and harm local platforms—news aggregators and social media platforms—can both benefit and harm local
newspapers.37 newspapers.37
News Aggregators
News aggregators38 curate content from various news publishers, including local and digital-News aggregators38 curate content from various news publishers, including local and digital-
native newspapers; some aggregators also publish original content.39 Aggregators rely on online native newspapers; some aggregators also publish original content.39 Aggregators rely on online
advertising and subscriptions for their revenue.40 They bundle articles and display them in a advertising and subscriptions for their revenue.40 They bundle articles and display them in a
particular order, often using proprietary algorithms that weigh factors such as relevance, particular order, often using proprietary algorithms that weigh factors such as relevance,
freshness, and authoritativeness of the content.41 Details about each aggregator’s ranking process, freshness, and authoritativeness of the content.41 Details about each aggregator’s ranking process,
such as the weight given to each factor used to prioritize certain news articles, are not publicly such as the weight given to each factor used to prioritize certain news articles, are not publicly
available. available.
Some newspapers have attracted readers by working with aggregators, particularly popular Some newspapers have attracted readers by working with aggregators, particularly popular
ones.42 Limiting aggregators’ access to a newspaper’s content can reduce overall news ones.42 Limiting aggregators’ access to a newspaper’s content can reduce overall news
consumption, including on the newspaper publisher’s own online platforms.43 However, consumption, including on the newspaper publisher’s own online platforms.43 However,
aggregators can also make it difficult for newspaper publishers to create direct relationships with aggregators can also make it difficult for newspaper publishers to create direct relationships with
their readers, potentially resulting in newspapers having fewer subscribers and limited data about their readers, potentially resulting in newspapers having fewer subscribers and limited data about
their readers.44 In addition, the visibility of each publisher’s content depends on the aggregator. their readers.44 In addition, the visibility of each publisher’s content depends on the aggregator.
Newspaper editors may have little or no control over the visibility of articles on an aggregator’s Newspaper editors may have little or no control over the visibility of articles on an aggregator’s

37 Although this report focuses on news aggregators and social media platforms, some of these issues may be applicable 37 Although this report focuses on news aggregators and social media platforms, some of these issues may be applicable
to other online platforms as well. to other online platforms as well.
38 Examples include Google News, Apple News, SmartNews, and Drudge Report. 38 Examples include Google News, Apple News, SmartNews, and Drudge Report.
39 For example, Yahoo News publishes original content; see https://news.yahoo.com/originals/. 39 For example, Yahoo News publishes original content; see https://news.yahoo.com/originals/.
40 For example, Google News and SmartNews obtain their revenue from online advertising, while Apple News+ is 40 For example, Google News and SmartNews obtain their revenue from online advertising, while Apple News+ is
subscription-based. subscription-based.
41 For example, Apple presents content selected by editors under “Top Stories” and content selected by its algorithms 41 For example, Apple presents content selected by editors under “Top Stories” and content selected by its algorithms
under “Trending Stories” on its Apple News feed, while Google uses only algorithms to rank content in its Google under “Trending Stories” on its Apple News feed, while Google uses only algorithms to rank content in its Google
News feed; see Apple, “See News Stories Chosen Just for You on iPhone,” Apple iPhone User Guide, accessed on News feed; see Apple, “See News Stories Chosen Just for You on iPhone,” Apple iPhone User Guide, accessed on
September 21, 2021, at https://support.apple.com/guide/iphone/see-news-stories-chosen-just-for-you-iph5b557ed3d/September 21, 2021, at https://support.apple.com/guide/iphone/see-news-stories-chosen-just-for-you-iph5b557ed3d/
ios; Google, “Surfacing Useful and Relevant Content,” Google News Initiative, accessed on September 21, 2021, at ios; Google, “Surfacing Useful and Relevant Content,” Google News Initiative, accessed on September 21, 2021, at
https://newsinitiative.withgoogle.com/hownewsworks/approach/surfacing-useful-and-relevant-content/. https://newsinitiative.withgoogle.com/hownewsworks/approach/surfacing-useful-and-relevant-content/.
42 For example, Robert Thomson, CEO of News Corporation, the publisher of the 42 For example, Robert Thomson, CEO of News Corporation, the publisher of the Wall Street Journal, stated that the , stated that the
“Apple News partnership allows us to ... bring in a significantly new audience that we would hope to graduate to a paid “Apple News partnership allows us to ... bring in a significantly new audience that we would hope to graduate to a paid
WSJ subscription over time.” See “Q4 2020 News Corp. Earnings Call—Final,” CQ-Roll Call, Inc subscription over time.” See “Q4 2020 News Corp. Earnings Call—Final,” CQ-Roll Call, Inc., August 6, 2020. , August 6, 2020.
43 Susan Athey, Mark Mobius, and Jeno Pal, “The Impact of Aggregators on Internet News Consumption,” National 43 Susan Athey, Mark Mobius, and Jeno Pal, “The Impact of Aggregators on Internet News Consumption,” National
Bureau of Economic Research, Working Paper No. 28746, April 2021, at http://www.nber.org/papers/w28746; Lesley Bureau of Economic Research, Working Paper No. 28746, April 2021, at http://www.nber.org/papers/w28746; Lesley
Chiou and Catherine Tucker, “Content Aggregation by Platforms: The Case of the News Media,” Chiou and Catherine Tucker, “Content Aggregation by Platforms: The Case of the News Media,” Journal of Economics
and Management Strategy, vol. 26, issue 4 (2017), pp. 782-805, at https://doi.org/10.1111/jems.12207; Joan Calzada , vol. 26, issue 4 (2017), pp. 782-805, at https://doi.org/10.1111/jems.12207; Joan Calzada
and Ricard Gil, “What Do News Aggregators Do? Evidence from Google News in Spain and Germany,” and Ricard Gil, “What Do News Aggregators Do? Evidence from Google News in Spain and Germany,” Marketing
Science, vol. 39, issue 1 (2020), pp. 134-167, at https://doi.org/10.1287/mksc.2019.1150. , vol. 39, issue 1 (2020), pp. 134-167, at https://doi.org/10.1287/mksc.2019.1150.
44 For example, this was the reason the 44 For example, this was the reason the New York Times stopped partnering with Apple News; see Kellen Browning and stopped partnering with Apple News; see Kellen Browning and
Jack Nicas, “The New York Times Pulls Out of Apple News,” Jack Nicas, “The New York Times Pulls Out of Apple News,” New York Times, June 29, 2020, at , June 29, 2020, at
https://www.nytimes.com/2020/06/29/technology/new-york-times-apple-news-app.html. https://www.nytimes.com/2020/06/29/technology/new-york-times-apple-news-app.html.
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website,45 and may be tempted to focus on content that they expect to be ranked higher by website,45 and may be tempted to focus on content that they expect to be ranked higher by
aggregators’ algorithms in an attempt to obtain a more prominent position on aggregators’ aggregators’ algorithms in an attempt to obtain a more prominent position on aggregators’
platforms.46 platforms.46
Some aggregators have created sections dedicated to local news.47 One study found that after Some aggregators have created sections dedicated to local news.47 One study found that after
Google News was redesigned to place links to geo-targeted local news content on its Home Page, Google News was redesigned to place links to geo-targeted local news content on its Home Page,
local news consumption among heavy Google News users rose by 25%, with no evidence that local news consumption among heavy Google News users rose by 25%, with no evidence that
consumers were visiting Google News rather than directly visiting the publishers’ platforms.48 consumers were visiting Google News rather than directly visiting the publishers’ platforms.48
However, some aggregators’ algorithms may give lower rankings to content from local However, some aggregators’ algorithms may give lower rankings to content from local
newspapers than to content from national newspapers,49 displaying local newspapers’ content less newspapers than to content from national newspapers,49 displaying local newspapers’ content less
prominently. prominently.
Specific terms of each publisher’s agreement with an aggregator typically are not publicly Specific terms of each publisher’s agreement with an aggregator typically are not publicly
available. Although some aggregators provide information on the amount of revenue they provide available. Although some aggregators provide information on the amount of revenue they provide
publishers,50 oftentimes details about an agreement between a specific publisher and aggregator publishers,50 oftentimes details about an agreement between a specific publisher and aggregator
are available only from news articles by individuals familiar with the negotiations.51 Popular are available only from news articles by individuals familiar with the negotiations.51 Popular
newspapers with a large customer base may be able to negotiate more favorable terms with newspapers with a large customer base may be able to negotiate more favorable terms with
aggregators and receive a larger share of revenue than smaller newspapers. aggregators and receive a larger share of revenue than smaller newspapers.
Some news aggregators may be able to leverage greater bargaining power over newspaper Some news aggregators may be able to leverage greater bargaining power over newspaper
publishers through their parent company’s other products and services. For example, Microsoft publishers through their parent company’s other products and services. For example, Microsoft
integrates its news aggregator in its browsers,52 and Apple preinstalls Apple News on its mobile integrates its news aggregator in its browsers,52 and Apple preinstalls Apple News on its mobile

45 For example, newspaper editors can increase the visibility of an article in a print publication by placing it on the front 45 For example, newspaper editors can increase the visibility of an article in a print publication by placing it on the front
page. page.
46 Stigler Committee on Digital Platforms, “Final Report: News Industry Subcommittee Report,” Chicago Booth Stigler 46 Stigler Committee on Digital Platforms, “Final Report: News Industry Subcommittee Report,” Chicago Booth Stigler
Center, 2019, at https://research.chicagobooth.edu/stigler/media/news/committee-on-digital-platforms-final-report, pp. Center, 2019, at https://research.chicagobooth.edu/stigler/media/news/committee-on-digital-platforms-final-report, pp.
139-205; Bertin Martens et al., “The Digital Transformation of News Media and the Rise of Disinformation and Fake 139-205; Bertin Martens et al., “The Digital Transformation of News Media and the Rise of Disinformation and Fake
News,” European Commission, Joint Research Centre Technical Report Working Paper 2018-02, April 2018, at News,” European Commission, Joint Research Centre Technical Report Working Paper 2018-02, April 2018, at
https://ec.europa.eu/jrc/sites/default/files/jrc111529.pdf; Susan Athey, Mark Mobius, and Jeno Pal, “The Impact of https://ec.europa.eu/jrc/sites/default/files/jrc111529.pdf; Susan Athey, Mark Mobius, and Jeno Pal, “The Impact of
Aggregators on Internet News Consumption,” Aggregators on Internet News Consumption,” NBER Working Paper No. 28746, April 2021, at http://www.nber.org/, April 2021, at http://www.nber.org/
papers/w28746. papers/w28746.
47 For example, Google News has a section dedicated to local news, where users can prioritize content from specific 47 For example, Google News has a section dedicated to local news, where users can prioritize content from specific
cities and zip codes, and SmartNews allows users to search for news in select cities. cities and zip codes, and SmartNews allows users to search for news in select cities.
48 Lisa George and Christiaan Hogendorn, “Local News Online: Aggregators, Geo-Targeting, and the Market for Local 48 Lisa George and Christiaan Hogendorn, “Local News Online: Aggregators, Geo-Targeting, and the Market for Local
News,” News,” Journal of Industrial Economics, vol. 68, issue 4 (December 2020), pp. 780-818. , vol. 68, issue 4 (December 2020), pp. 780-818.
49 Sean Fischer, Kokil Jaidka, and Yphtach Lelkes, “Auditing Local News Presence on Google News,” 49 Sean Fischer, Kokil Jaidka, and Yphtach Lelkes, “Auditing Local News Presence on Google News,” Nature Human
Behavior, vol. 4 (December 2020), pp. 1236-1244, at https://doi.org/10.1038/s41562-020-00954-0. , vol. 4 (December 2020), pp. 1236-1244, at https://doi.org/10.1038/s41562-020-00954-0.
50 For example, according to Apple News, publishers keep all of the advertising revenue generated from ads sold by the 50 For example, according to Apple News, publishers keep all of the advertising revenue generated from ads sold by the
publisher and 70% of the revenue from ads sold by Apple. In October 2020, Google stated that it would spend $1 publisher and 70% of the revenue from ads sold by Apple. In October 2020, Google stated that it would spend $1
billion investing in partnerships with newspaper publishers in a new platform, Google News Showcase. Google stated billion investing in partnerships with newspaper publishers in a new platform, Google News Showcase. Google stated
that it had signed partnerships with nearly 200 leading publications across Germany, Brazil, Argentina, Canada, the that it had signed partnerships with nearly 200 leading publications across Germany, Brazil, Argentina, Canada, the
United Kingdom, and Australia. However, it is unclear whether or when this would expand to U.S. publishers. Apple, United Kingdom, and Australia. However, it is unclear whether or when this would expand to U.S. publishers. Apple,
“Publishing on Apple News,” Apple Developer, accessed on November 17, 2021, at https://developer.apple.com/news-“Publishing on Apple News,” Apple Developer, accessed on November 17, 2021, at https://developer.apple.com/news-
publisher/; Sundar Pichai, “Our $1 Billion Investment in Partnerships with News Publishers,” Google Blog, October 1, publisher/; Sundar Pichai, “Our $1 Billion Investment in Partnerships with News Publishers,” Google Blog, October 1,
2020, at https://blog.google/outreach-initiatives/google-news-initiative/google-news-showcase/. 2020, at https://blog.google/outreach-initiatives/google-news-initiative/google-news-showcase/.
51 For example, Apple was reportedly seeking to take 50% of the revenue generated through Apple News+, the 51 For example, Apple was reportedly seeking to take 50% of the revenue generated through Apple News+, the
subscription-based version of Apple News that provides additional content, and a Google spokesman stated that subscription-based version of Apple News that provides additional content, and a Google spokesman stated that
publishers received over 70% of the ad revenue when they use Google tools to monetize their content. Lukas Alpert, publishers received over 70% of the ad revenue when they use Google tools to monetize their content. Lukas Alpert,
“Facebook Chief Mark Zuckerberg Urges Tech Rivals to Pay for News,” “Facebook Chief Mark Zuckerberg Urges Tech Rivals to Pay for News,” Wall Street Journal, October 25, 2019, at , October 25, 2019, at
https://www.wsj.com/articles/facebook-launches-news-service-for-select-users-11571997601; Apple, “Apple News+,” https://www.wsj.com/articles/facebook-launches-news-service-for-select-users-11571997601; Apple, “Apple News+,”
accessed on January 14, 2022, at https://www.apple.com/apple-news/. accessed on January 14, 2022, at https://www.apple.com/apple-news/.
52 Microsoft recently launched a news aggregator, Microsoft Start, to replace Microsoft News. It also started replacing 52 Microsoft recently launched a news aggregator, Microsoft Start, to replace Microsoft News. It also started replacing
its web browser Internet Explorer with Microsoft Edge. The news aggregators were and will continue to be integrated its web browser Internet Explorer with Microsoft Edge. The news aggregators were and will continue to be integrated
with the web browsers. Sarah Perez, “Microsoft Launches A Personalized News Service, Microsoft Start,” with the web browsers. Sarah Perez, “Microsoft Launches A Personalized News Service, Microsoft Start,”
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devices and tablets.53 Other firms operate news aggregators alongside online platforms that offer devices and tablets.53 Other firms operate news aggregators alongside online platforms that offer
services that some newspaper publishers may rely on, such as search engines and advertising services that some newspaper publishers may rely on, such as search engines and advertising
tools. News aggregators integrated with other platforms or devices may be convenient for some tools. News aggregators integrated with other platforms or devices may be convenient for some
publishers and consumers, but they could also make it difficult for other news aggregators that do publishers and consumers, but they could also make it difficult for other news aggregators that do
not operate similar access points to compete, increasing the market power of these integrated not operate similar access points to compete, increasing the market power of these integrated
aggregators. aggregators.
Although the Copyright Act generally prohibits aggregators and other online platforms from Although the Copyright Act generally prohibits aggregators and other online platforms from
distributing full articles without the express consent of the copyright owner (usually the distributing full articles without the express consent of the copyright owner (usually the
publisher),54 the extent of these legal protections is not always clear.55 For example, Google News publisher),54 the extent of these legal protections is not always clear.55 For example, Google News
provides snippets of news articles on its Home Page and in search results.56 While Google provides snippets of news articles on its Home Page and in search results.56 While Google
considers this “fair use” of publishers’ content,57 newspapers have claimed that the Copyright Act considers this “fair use” of publishers’ content,57 newspapers have claimed that the Copyright Act
does not provide a clear-cut standard to determine what constitutes “fair use.”58 One study found does not provide a clear-cut standard to determine what constitutes “fair use.”58 One study found
that when an aggregator displayed more information about a news article, such as longer snippets that when an aggregator displayed more information about a news article, such as longer snippets
or accompanying images, readers were less likely to click through to the original article on the or accompanying images, readers were less likely to click through to the original article on the
publisher’s platform.59 However, the same study also found that when there were several related publisher’s platform.59 However, the same study also found that when there were several related
articles, more information about an article increased the probability that readers would choose it articles, more information about an article increased the probability that readers would choose it
over the other articles. over the other articles.
In May 2021, Members of the Senate Committee on the Judiciary sent a letter to the Register of In May 2021, Members of the Senate Committee on the Judiciary sent a letter to the Register of
Copyrights requesting a study of protections for publishers under copyright law to be completed Copyrights requesting a study of protections for publishers under copyright law to be completed
no later than May 3, 2022. The study would “assist [them] as they consider what legislative no later than May 3, 2022. The study would “assist [them] as they consider what legislative
reforms, if any, should be taken in this area of copyright law.”60 In October 2021, the U.S. reforms, if any, should be taken in this area of copyright law.”60 In October 2021, the U.S.
Copyright Office announced that that it would conduct “a public study to evaluate the Copyright Office announced that that it would conduct “a public study to evaluate the
effectiveness of current copyright protections for publishers in the United States, with a focus on effectiveness of current copyright protections for publishers in the United States, with a focus on

TechCrunch, September 7, 2021, at https://techcrunch.com/2021/09/07/microsoft-launches-a-personalized-news-, September 7, 2021, at https://techcrunch.com/2021/09/07/microsoft-launches-a-personalized-news-
service-microsoft-start/; Sean Lyndersay, “The Future of Internet Explorer on Windows 10 is in Microsoft service-microsoft-start/; Sean Lyndersay, “The Future of Internet Explorer on Windows 10 is in Microsoft
Edge,”Windows Blog, May 19, 2021, at https://blogs.windows.com/windowsexperience/2021/05/19/the-future-of-Edge,”Windows Blog, May 19, 2021, at https://blogs.windows.com/windowsexperience/2021/05/19/the-future-of-
internet-explorer-on-windows-10-is-in-microsoft-edge/. internet-explorer-on-windows-10-is-in-microsoft-edge/.
53 Apple, “iPad & iPhone,” App Store Preview, accessed on October 19, 2021, at https://apps.apple.com/us/developer/ 53 Apple, “iPad & iPhone,” App Store Preview, accessed on October 19, 2021, at https://apps.apple.com/us/developer/
apple/id284417353?mt=12#see-all/i-phonei-pad-apps. apple/id284417353?mt=12#see-all/i-phonei-pad-apps.
54 17 U.S.C. §106(3). 54 17 U.S.C. §106(3).
55 In addition to copyright laws, news aggregators that do not publish original content may also receive federal 55 In addition to copyright laws, news aggregators that do not publish original content may also receive federal
immunity from liability for information provided by a third party (e.g., the news publisher) under Section 230 of the immunity from liability for information provided by a third party (e.g., the news publisher) under Section 230 of the
Communications Act of 1934. For more information, see CRS Report R46751, Communications Act of 1934. For more information, see CRS Report R46751, Section 230: An Overview, by Valerie , by Valerie
C. Brannon and Eric N. Holmes. C. Brannon and Eric N. Holmes.
56 Google, “Best Practices for Your Article Pages,” Google Publisher Center Help, at https://support.google.com/news/ 56 Google, “Best Practices for Your Article Pages,” Google Publisher Center Help, at https://support.google.com/news/
publisher-center/answer/9607104?hl=en. publisher-center/answer/9607104?hl=en.
57 Richard Gingras, “Setting the Record Straight on News,” Google News Initiative Blog, June 26, 2020, at 57 Richard Gingras, “Setting the Record Straight on News,” Google News Initiative Blog, June 26, 2020, at
https://blog.google/outreach-initiatives/google-news-initiative/setting-record-straight-news/. https://blog.google/outreach-initiatives/google-news-initiative/setting-record-straight-news/.
58 Johannes Munter, “Fairer Fair Use,” News Media Alliance, February 27, 2021 at 58 Johannes Munter, “Fairer Fair Use,” News Media Alliance, February 27, 2021 at
https://www.newsmediaalliance.org/fairer-fair-use/. https://www.newsmediaalliance.org/fairer-fair-use/.
59 Chrysanthos Dellarocas et al., “Attention Allocation in Information-Rich Environments: The Case of News 59 Chrysanthos Dellarocas et al., “Attention Allocation in Information-Rich Environments: The Case of News
Aggregators,” Aggregators,” Management Science, vol. 62, no. 9 (September 2016), pp. 2457-2764, at https://doi.org/10.1287/, vol. 62, no. 9 (September 2016), pp. 2457-2764, at https://doi.org/10.1287/
mnsc.2015.2237. mnsc.2015.2237.
60 Letter from Senators Thom Tillis, Patrick Leahy, John Cornyn, Mazie Hirono, Amy Klobuchar, and Christopher 60 Letter from Senators Thom Tillis, Patrick Leahy, John Cornyn, Mazie Hirono, Amy Klobuchar, and Christopher
Coons to Shira Perlmutter, Register of Copyrights, U.S. Copyright Office, May 3, 2021, at https://www.copyright.gov/Coons to Shira Perlmutter, Register of Copyrights, U.S. Copyright Office, May 3, 2021, at https://www.copyright.gov/
policy/publishersprotections/letter-to-the-copyright-office.pdf. policy/publishersprotections/letter-to-the-copyright-office.pdf.
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press publishers.”61 Governments in other countries have also introduced legislation to address press publishers.”61 Governments in other countries have also introduced legislation to address
this issue.62 this issue.62
Social Media Platforms
Social media platforms distribute newspapers’ content in a variety of ways.63 Newspapers can Social media platforms distribute newspapers’ content in a variety of ways.63 Newspapers can
create their own social media accounts, individual reporters can post information, and other users create their own social media accounts, individual reporters can post information, and other users
can also post and share links to newspaper articles. In these cases, content from newspapers is can also post and share links to newspaper articles. In these cases, content from newspapers is
intermixed with content from other sources. Some social media platforms have created sections of intermixed with content from other sources. Some social media platforms have created sections of
their platforms that provide news articles only from selected newspapers, including local ones.64 their platforms that provide news articles only from selected newspapers, including local ones.64
As with news aggregators, social media platforms can increase the visibility of some newspaper As with news aggregators, social media platforms can increase the visibility of some newspaper
articles while diminishing it for others. These platforms have an incentive to amplify publishers’ articles while diminishing it for others. These platforms have an incentive to amplify publishers’
content that they expect to increase user engagement to increase their revenue from online content that they expect to increase user engagement to increase their revenue from online
advertising.65 Some social media platforms “recommend” content, which can include newspaper advertising.65 Some social media platforms “recommend” content, which can include newspaper
content that increases user engagement, even if nobody in the user’s network directly shares the content that increases user engagement, even if nobody in the user’s network directly shares the
article. One study found that social media platforms can increase online news consumption,66 article. One study found that social media platforms can increase online news consumption,66
potentially reducing the amount of time readers spend on news publishers’ platforms. potentially reducing the amount of time readers spend on news publishers’ platforms.
Nevertheless, it is unclear whether newspaper publishers would benefit if social media platforms Nevertheless, it is unclear whether newspaper publishers would benefit if social media platforms
did not include news content.67 Some social media platforms have developed technologies that did not include news content.67 Some social media platforms have developed technologies that

61 U.S. Copyright Office, “Study on Ancillary Copyright Protections for Publishers,” at https://www.copyright.gov/61 U.S. Copyright Office, “Study on Ancillary Copyright Protections for Publishers,” at https://www.copyright.gov/
policy/publishersprotections/; U.S. Copyright Office, Library of Congress, “Publishers’ Protections Study: Notice and policy/publishersprotections/; U.S. Copyright Office, Library of Congress, “Publishers’ Protections Study: Notice and
Request for Public Comment,” 86Request for Public Comment,” 86 Federal Register 59721, October 12, 2021. 59721, October 12, 2021.
62 For example, Australia’s parliament passed legislation establishing a code of conduct for negotiations between news 62 For example, Australia’s parliament passed legislation establishing a code of conduct for negotiations between news
publishers and online platforms. Facebook and Google initially stated the bill would be unworkable, but subsequently publishers and online platforms. Facebook and Google initially stated the bill would be unworkable, but subsequently
reached agreements with publishers. See Parliament of Australia, Treasury Law Amendment (News Media and Digital reached agreements with publishers. See Parliament of Australia, Treasury Law Amendment (News Media and Digital
Platforms Mandatory Bargaining Code) Bill 2021, February 25, 2021, at https://parlinfo.aph.gov.au/parlInfo/search/Platforms Mandatory Bargaining Code) Bill 2021, February 25, 2021, at https://parlinfo.aph.gov.au/parlInfo/search/
display/display.w3p;query=Id%3A%22legislation%2Fbillhome%2Fr6652%22; William Easton, “Changes to Sharing display/display.w3p;query=Id%3A%22legislation%2Fbillhome%2Fr6652%22; William Easton, “Changes to Sharing
and Viewing News on Facebook in Australia,” and Viewing News on Facebook in Australia,” Facebook News, February 17, 2021, at https://about.fb.com/news/2021/, February 17, 2021, at https://about.fb.com/news/2021/
02/changes-to-sharing-and-viewing-news-on-facebook-in-australia/; Mel Silva, “Supporting Australian Journalism: A 02/changes-to-sharing-and-viewing-news-on-facebook-in-australia/; Mel Silva, “Supporting Australian Journalism: A
Constructive Path Forward,” Constructive Path Forward,” Google Blog, at https://about.google/google-in-australia/an-open-letter/. , at https://about.google/google-in-australia/an-open-letter/.
Similarly, the French competition authority required Google to negotiate with publishers about using their content after Similarly, the French competition authority required Google to negotiate with publishers about using their content after
the government implemented components of the European Union Digital Single Market Directive, which created the government implemented components of the European Union Digital Single Market Directive, which created
obligations for online content-sharing service providers, such as requiring providers to make “best efforts” to obtain obligations for online content-sharing service providers, such as requiring providers to make “best efforts” to obtain
licenses for content that appears on their sites. Google reportedly reached an agreement with the publishers in January licenses for content that appears on their sites. Google reportedly reached an agreement with the publishers in January
2021. See European Union, “Directive 2019/790 of the European Parliament and of the Council,” Official Journal of 2021. See European Union, “Directive 2019/790 of the European Parliament and of the Council,” Official Journal of
the European Union, April 17, 2019, at https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/the European Union, April 17, 2019, at https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/
?uri=CELEX:32019L0790&from=EN; Natasha Lomas, “Google Inks Agreement in France on Paying Publishers for ?uri=CELEX:32019L0790&from=EN; Natasha Lomas, “Google Inks Agreement in France on Paying Publishers for
News Reuse,” News Reuse,” TechCrunch, January 21, 2021, at https://techcrunch.com/2021/01/21/google-inks-agreement-in-france-, January 21, 2021, at https://techcrunch.com/2021/01/21/google-inks-agreement-in-france-
on-paying-publishers-for-news-reuse/. on-paying-publishers-for-news-reuse/.
63 This section focuses on news publishers’ relationship with social media. News publishers can be affected by other 63 This section focuses on news publishers’ relationship with social media. News publishers can be affected by other
aspects of social media, such as users posting information about an incident (e.g., car accident, shooting), particularly if aspects of social media, such as users posting information about an incident (e.g., car accident, shooting), particularly if
it spreads quickly or goes “viral.” These potential effects are beyond the scope of this report. it spreads quickly or goes “viral.” These potential effects are beyond the scope of this report.
64 For example, Facebook launched a section exclusively for news—Facebook News—in June 2020; see Sarah Perez, 64 For example, Facebook launched a section exclusively for news—Facebook News—in June 2020; see Sarah Perez,
“Facebook Launches to All U.S. with Addition of Local News and Video,” TechCrunch, June 9, 2020, at “Facebook Launches to All U.S. with Addition of Local News and Video,” TechCrunch, June 9, 2020, at
https://techcrunch.com/2020/06/09/facebook-news-launches-to-all-in-u-s-with-addition-of-local-news-and-video/; https://techcrunch.com/2020/06/09/facebook-news-launches-to-all-in-u-s-with-addition-of-local-news-and-video/;
Facebook, “How Facebook News Works,” Facebook News, at https://www.facebook.com/news/howitworks. Facebook, “How Facebook News Works,” Facebook News, at https://www.facebook.com/news/howitworks.
65 Online advertising is the primary source of revenue for most social media platforms. For example, in 2020, it made 65 Online advertising is the primary source of revenue for most social media platforms. For example, in 2020, it made
up 98% of Facebook’s total revenue and 86% of Twitter’s. See Facebook Inc. SEC Form 10-K for the year ending up 98% of Facebook’s total revenue and 86% of Twitter’s. See Facebook Inc. SEC Form 10-K for the year ending
December 31, 2020; Twitter Inc. SEC Form 10-K for the year ending December 31, 2020. December 31, 2020; Twitter Inc. SEC Form 10-K for the year ending December 31, 2020.
66 Sinan Aral and Michael Zhao, “Social Media Sharing and Online News Consumption,” SSRN, posted February 14, 66 Sinan Aral and Michael Zhao, “Social Media Sharing and Online News Consumption,” SSRN, posted February 14,
2019, at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3328864. 2019, at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3328864.
67 Some studies have found that when users are unable to access news content through social media, more individuals 67 Some studies have found that when users are unable to access news content through social media, more individuals
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make it possible for publishers to obtain more detailed information about their readers and target make it possible for publishers to obtain more detailed information about their readers and target
potential readers;68 some newspapers, particularly smaller ones, may not have direct access to potential readers;68 some newspapers, particularly smaller ones, may not have direct access to
these technologies. these technologies.
The complexities of social media platforms’ relationship with newspapers mirror those of news The complexities of social media platforms’ relationship with newspapers mirror those of news
aggregators. Detailed information about social media platforms’ agreements with newspaper aggregators. Detailed information about social media platforms’ agreements with newspaper
publishers typically are not publicly available, and the applicability of existing regulations, publishers typically are not publicly available, and the applicability of existing regulations,
particularly related to copyright laws, can be unclear. For example, when Meta (formerly particularly related to copyright laws, can be unclear. For example, when Meta (formerly
Facebook Inc.)69 launched a news section on its platform Facebook, it reportedly paid licensing Facebook Inc.)69 launched a news section on its platform Facebook, it reportedly paid licensing
fees to only some of the publishers whose articles it republished, with the amount depending on fees to only some of the publishers whose articles it republished, with the amount depending on
the size of the publisher.70 Meta subsequently stated that it would pay $5 million to support local the size of the publisher.70 Meta subsequently stated that it would pay $5 million to support local
journalists to “regularly publish written, public-interest journalism focused on a local journalists to “regularly publish written, public-interest journalism focused on a local
community,” with precedence given to areas that “are not currently served by an existing community,” with precedence given to areas that “are not currently served by an existing
journalism entity.”71 journalism entity.”71
Newspaper Websites: Flow of Advertising Revenue
Online advertising has become a growing source of revenue for newspaper publishers, as Online advertising has become a growing source of revenue for newspaper publishers, as
discussed earlier (seediscussed earlier (see Figure 2). Nevertheless, for several reasons, the revenue many newspaper . Nevertheless, for several reasons, the revenue many newspaper
publishers receive from online advertising is insufficient to compensate for the decline in print publishers receive from online advertising is insufficient to compensate for the decline in print
advertising. Online advertising has not enabled newspaper publishers to regain print advertising advertising. Online advertising has not enabled newspaper publishers to regain print advertising
devoted to recruitment, real estate, and vehicle sales. More generally, a proliferation of options devoted to recruitment, real estate, and vehicle sales. More generally, a proliferation of options
has constrained the prices media outlets can charge for online advertising, particularly for has constrained the prices media outlets can charge for online advertising, particularly for
advertisements appearing on mobile devices.72 advertisements appearing on mobile devices.72
In order to attract readers to their websites and sell online advertising, newspaper publishers must In order to attract readers to their websites and sell online advertising, newspaper publishers must
rely on some of the very companies with which they compete for advertising revenue. rely on some of the very companies with which they compete for advertising revenue.
Newspapers rely on Google’s search engine and Google News to refer readers to their news sites. Newspapers rely on Google’s search engine and Google News to refer readers to their news sites.
In addition, both advertisers and newspaper publishers rely on Google to supply the technology In addition, both advertisers and newspaper publishers rely on Google to supply the technology
necessary to place online advertising. necessary to place online advertising.
This section describes how the structure of the online advertising industry—particularly the This section describes how the structure of the online advertising industry—particularly the
structure of the automated, or “programmatic,” advertising industry—affects the flow of structure of the automated, or “programmatic,” advertising industry—affects the flow of

went directly to the news publishers’ platform (Josh Schwartz, “What Happens When Facebook Goes Down? People went directly to the news publishers’ platform (Josh Schwartz, “What Happens When Facebook Goes Down? People
Read the News,” Nieman Lab, October 22, 2018, at https://www.niemanlab.org/2018/10/what-happens-when-Read the News,” Nieman Lab, October 22, 2018, at https://www.niemanlab.org/2018/10/what-happens-when-
facebook-goes-down-people-read-the-news/), while others found that fewer individuals do (Catarina Sismeiro and facebook-goes-down-people-read-the-news/), while others found that fewer individuals do (Catarina Sismeiro and
Ammara Mahmod, “Competitive vs. Complementary Effects in Online Social Networks and News Consumption: A Ammara Mahmod, “Competitive vs. Complementary Effects in Online Social Networks and News Consumption: A
Natural Experiment,” Natural Experiment,” Management Science, vol. 64, no. 11 (November 2018), pp. 5014-5037). , vol. 64, no. 11 (November 2018), pp. 5014-5037).
68 For example, Facebook offers various tools, such as Page Insights, that provide information on the number of views 68 For example, Facebook offers various tools, such as Page Insights, that provide information on the number of views
and other metrics for each piece of content. Facebook, “The Journalist’s Guide to Facebook and Instagram,” Facebook and other metrics for each piece of content. Facebook, “The Journalist’s Guide to Facebook and Instagram,” Facebook
Journalism Project, May 2021. Journalism Project, May 2021.
69 Meta, “Introducing Meta: A Social Technology Company,” October 28, 2021, at https://about.fb.com/news/2021/10/ 69 Meta, “Introducing Meta: A Social Technology Company,” October 28, 2021, at https://about.fb.com/news/2021/10/
facebook-company-is-now-meta/. facebook-company-is-now-meta/.
70 Lukas Alpert and Sahil Patel, “With Facebook’s Coming News Tab, Only Some Will Get Paid,” 70 Lukas Alpert and Sahil Patel, “With Facebook’s Coming News Tab, Only Some Will Get Paid,” Wall Street Journal, ,
September 30, 2019, at https://www.wsj.com/articles/with-facebooks-coming-news-tab-only-some-will-get-paid-September 30, 2019, at https://www.wsj.com/articles/with-facebooks-coming-news-tab-only-some-will-get-paid-
11569852600. 11569852600.
71 Campbell Brown, “Creating More Opportunities for Independent, Local Writers to Thrive,” Meta Journalism Project, 71 Campbell Brown, “Creating More Opportunities for Independent, Local Writers to Thrive,” Meta Journalism Project,
April 29, 2021, at https://www.facebook.com/journalismproject/apply-platform-independent-writers. April 29, 2021, at https://www.facebook.com/journalismproject/apply-platform-independent-writers.
72 Tribune 2020 SEC Form 10-K., p. 10; Gannett Co., Inc. SEC Form 10-K for the fiscal year ended December 31, 72 Tribune 2020 SEC Form 10-K., p. 10; Gannett Co., Inc. SEC Form 10-K for the fiscal year ended December 31,
2020, pp. 19-20 (Gannett 2020 SEC Form 10-K); NYT 2020 Annual Report, p. 12. 2020, pp. 19-20 (Gannett 2020 SEC Form 10-K); NYT 2020 Annual Report, p. 12.
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advertising revenue to newspaper publishers, and the role of Google in the advertising technology advertising revenue to newspaper publishers, and the role of Google in the advertising technology
supply chain. supply chain.
Digital Advertising Formats/Types of Expenditures
Digital advertising typically appears in one of six forms:73 Digital advertising typically appears in one of six forms:73
  Digital display advertising describes the “boxes” on websites, apps, or describes the “boxes” on websites, apps, or
platforms that appear along the top of the screen as a “banner ad” or elsewhere platforms that appear along the top of the screen as a “banner ad” or elsewhere
on the screen. Digital display represented an estimated 31.5% of the $139.8 on the screen. Digital display represented an estimated 31.5% of the $139.8
billion in U.S. digital advertising expenditures in 2020. billion in U.S. digital advertising expenditures in 2020.
  Search advertising is the term used to describe listings of advertisers returned in is the term used to describe listings of advertisers returned in
response to a consumer’s query. The advertisers pay to have their names and response to a consumer’s query. The advertisers pay to have their names and
website links included and/or prioritized among the query results. Search website links included and/or prioritized among the query results. Search
accounted for an estimated 42% of 2020 digital ad spending in the United States. accounted for an estimated 42% of 2020 digital ad spending in the United States.
  Video advertising refers to online advertisements that contain video. These refers to online advertisements that contain video. These
accounted for an estimated 18% of 2020 U.S. digital advertising expenditures. accounted for an estimated 18% of 2020 U.S. digital advertising expenditures.
  Classified advertisements. These accounted for an estimated 2.9% of 2020 U.S. These accounted for an estimated 2.9% of 2020 U.S.
digital advertising expenditures. digital advertising expenditures.
  Lead generation fees refer to payments made by advertisers to website operators fees refer to payments made by advertisers to website operators
that refer qualified potential customers or provide information about consumers that refer qualified potential customers or provide information about consumers
who have agreed to be contacted by advertisers. These represented an estimated who have agreed to be contacted by advertisers. These represented an estimated
2.4% of 2020 U.S. digital advertising expenditures. 2.4% of 2020 U.S. digital advertising expenditures.
  Audio formats are audio-only advertisements. Digital audio advertisements are audio-only advertisements. Digital audio advertisements
occur in streaming music services and podcasts, among other media. These occur in streaming music services and podcasts, among other media. These
represented an estimated 2.1% of 2020 U.S. digital advertising expenditures. represented an estimated 2.1% of 2020 U.S. digital advertising expenditures.
Thus, the most popular formats of digital advertising are digital display and search, which Thus, the most popular formats of digital advertising are digital display and search, which
combined accounted for 73.5%, or $102.8 billion, of 2020 U.S. digital advertising expenditures. combined accounted for 73.5%, or $102.8 billion, of 2020 U.S. digital advertising expenditures.
Market research firms and government studies indicate that Google plays a significant role in the Market research firms and government studies indicate that Google plays a significant role in the
selling of each format, both directly (especially in search)74 and indirectly, as an intermediary in selling of each format, both directly (especially in search)74 and indirectly, as an intermediary in
the display advertising marketplace. Most local newspapers primarily rely on “digital display the display advertising marketplace. Most local newspapers primarily rely on “digital display
advertising” for online advertising revenues.75 advertising” for online advertising revenues.75
Reliance on Technology Firms in Programmatic Advertising
The process of purchasing and selling advertising in nondigital media (e.g., print editions of The process of purchasing and selling advertising in nondigital media (e.g., print editions of
newspapers) has traditionally been relatively straightforward: advertisers or their advertising newspapers) has traditionally been relatively straightforward: advertisers or their advertising
agencies contacted the media organization’s salespeople (or vice versa), and the parties would agencies contacted the media organization’s salespeople (or vice versa), and the parties would
negotiate and agree on contracts concerning price, ad placement, and frequency, among other negotiate and agree on contracts concerning price, ad placement, and frequency, among other
terms and conditions. In the early days of digital advertising, the process was similar, involving terms and conditions. In the early days of digital advertising, the process was similar, involving
bilateral negotiations between representatives of buyers and sellers of advertising.76 The process bilateral negotiations between representatives of buyers and sellers of advertising.76 The process

73 PwC and Internet Advertising Bureau, 73 PwC and Internet Advertising Bureau, Internet Advertising Revenue Report: Full-Year 2020 Results, New York, NY, , New York, NY,
April 2021, p. 14, at https://www.iab.com/insights/internet-advertising-revenue-report/. April 2021, p. 14, at https://www.iab.com/insights/internet-advertising-revenue-report/.
74 Research firm e-Marketer estimated that Google would have 56.8% of all U.S. ad search revenue during 2021. Sara 74 Research firm e-Marketer estimated that Google would have 56.8% of all U.S. ad search revenue during 2021. Sara
Lebow, “Google Collects More Than Half of All U.S. Search Ad Revenue,” eMarketer, April 12, 2021, at Lebow, “Google Collects More Than Half of All U.S. Search Ad Revenue,” eMarketer, April 12, 2021, at
https://www.emarketer.com/content/google-collects-more-than-half-of-all-us-search-ad-revenue. https://www.emarketer.com/content/google-collects-more-than-half-of-all-us-search-ad-revenue.
75 See, for example, DallasNews SEC Form 10-K, p. 13 (explaining components of its digital advertising revenues). 75 See, for example, DallasNews SEC Form 10-K, p. 13 (explaining components of its digital advertising revenues).
76 OECD November 2020 Report, p. 14. 76 OECD November 2020 Report, p. 14.
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was based solely on “contextual targeting.” That is, brands associated with a particular topic was based solely on “contextual targeting.” That is, brands associated with a particular topic
would attempt to place advertisements in spaces next to related articles or within related websites. would attempt to place advertisements in spaces next to related articles or within related websites.
Figure 5 illustrates how a classified advertisement sold directly via a newspaper publisher, based illustrates how a classified advertisement sold directly via a newspaper publisher, based
on contextual targeting, appears to a visitor of the newspaper’s website. on contextual targeting, appears to a visitor of the newspaper’s website.
Figure 5. Classified Ad Based on Contextual Targeting

Source: New York Times, December 21, 2021, at https://www.nytimes.com/2021/12/21/theater/broadway-covid-, December 21, 2021, at https://www.nytimes.com/2021/12/21/theater/broadway-covid-
omicron.html (visited December 21, 2021). omicron.html (visited December 21, 2021).
In the last 25 years, however, the buying and selling of digital advertising has become more In the last 25 years, however, the buying and selling of digital advertising has become more
automated and complex, with computer software using algorithms to buy and sell advertising on automated and complex, with computer software using algorithms to buy and sell advertising on
newspapers’ websites via intermediaries. The term “programmatic” refers to this automated newspapers’ websites via intermediaries. The term “programmatic” refers to this automated
process of buying and selling advertisements. process of buying and selling advertisements.
Regardless of whether online publishers sell their online display advertising inventory directly to Regardless of whether online publishers sell their online display advertising inventory directly to
advertisers, or indirectly (via intermediaries), the advertisements target specific users at specific advertisers, or indirectly (via intermediaries), the advertisements target specific users at specific
times and locations.77 Instead of purchasing inventory based on the content of a newspaper’s times and locations.77 Instead of purchasing inventory based on the content of a newspaper’s
online articles, advertisers purchase the inventory based on the ability to reach a specific user. online articles, advertisers purchase the inventory based on the ability to reach a specific user.
Because online ads are targeted at individual users, a website with three different ad slots on a Because online ads are targeted at individual users, a website with three different ad slots on a
page with 1 million readers has 3 million unique ad units to sell. page with 1 million readers has 3 million unique ad units to sell.
Direct Programmatic Sales Process: Large Publishers
Large publishers, including publishers of major national newspapers such as the Large publishers, including publishers of major national newspapers such as the New York Times
and the and the Wall Street Journal, can sell their advertising inventory directly to advertisers.78 In a , can sell their advertising inventory directly to advertisers.78 In a

77 Third Amended Complaint, 77 Third Amended Complaint, State of Texas, et al. v. Google LLC, No. 1:21-md-03010-PKC (S.D. NY January 14, , No. 1:21-md-03010-PKC (S.D. NY January 14,
2022), ¶¶44-45 (Texas, et al. v. Google, January 2022 3rd Amended Complaint). For more information about this 2022), ¶¶44-45 (Texas, et al. v. Google, January 2022 3rd Amended Complaint). For more information about this
lawsuit, see lawsuit, see “Google’s Role in Advertising Technology Stack.” The states originally filed their third amended The states originally filed their third amended
complaint in November 2021, Third Amended Complaint, The State of Texas, et al. v. Google, LLC, 1:21-CV-06841 complaint in November 2021, Third Amended Complaint, The State of Texas, et al. v. Google, LLC, 1:21-CV-06841
(S.D.N.Y. (S.D.N.Y. ~~Nov.~~November 12, 2021). The Southern District of New York released a version in January 2022 with fewer 12, 2021). The Southern District of New York released a version in January 2022 with fewer
redactions. This report references the January 2022 version. redactions. This report references the January 2022 version.
78 OECD November 2020 Report, p. 15. In an effort to improve users’ experiences, the New York Times Company has 78 OECD November 2020 Report, p. 15. In an effort to improve users’ experiences, the New York Times Company has
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process called “programmatic direct,” large publishers conduct automated private auctions of process called “programmatic direct,” large publishers conduct automated private auctions of
advertising space or employ salespeople to negotiate longer-term placements with advertisers. advertising space or employ salespeople to negotiate longer-term placements with advertisers.
The publishers’ own ad servers manage the inventory of available advertising spaces and are The publishers’ own ad servers manage the inventory of available advertising spaces and are
responsible for the decision logic underlying the final choice of which ad to serve, based on the responsible for the decision logic underlying the final choice of which ad to serve, based on the
direct deals reached between the publisher and advertisers.79 According to Google’s internal direct deals reached between the publisher and advertisers.79 According to Google’s internal
analysis, large news publishers keep 95% of the revenue when they sell advertisements directly in analysis, large news publishers keep 95% of the revenue when they sell advertisements directly in
this way.80 this way.80
Indirect Programmatic Sales Process: Smaller Publishers
A publisher cannot forecast precisely how many of its ad spaces will be available to sell directly A publisher cannot forecast precisely how many of its ad spaces will be available to sell directly
to advertisers because its inventory depends on how many users actually visit the publisher’s to advertisers because its inventory depends on how many users actually visit the publisher’s
website.81 For this reason, a publisher may find itself with unsold surplus inventory. Enabling website.81 For this reason, a publisher may find itself with unsold surplus inventory. Enabling
publishers to sell inventory that otherwise might be surplus was the original impetus for the publishers to sell inventory that otherwise might be surplus was the original impetus for the
development of a specialized “indirect” distribution channel, whereby publishers sell their ad development of a specialized “indirect” distribution channel, whereby publishers sell their ad
inventory indirectly to advertisers via auctions. inventory indirectly to advertisers via auctions.
“Indirect” sales occur through centralized electronic trading venues called “ad exchanges” and “Indirect” sales occur through centralized electronic trading venues called “ad exchanges” and
through “networks” of publishers and advertisers. Publishers that sell this way permit ad through “networks” of publishers and advertisers. Publishers that sell this way permit ad
exchanges to auction off some or their entire inventory to advertisers in real time; in return, the ad exchanges to auction off some or their entire inventory to advertisers in real time; in return, the ad
exchange or network will retain a portion of the proceeds.exchange or network will retain a portion of the proceeds. Figure 6 illustrates how a display illustrates how a display
advertisement sold via indirect advertising appears to some readers of an online newspaper’s advertisement sold via indirect advertising appears to some readers of an online newspaper’s
website. Based on his/her/their behavioral data, another reader viewing the same article might see website. Based on his/her/their behavioral data, another reader viewing the same article might see
a different display advertisement. a different display advertisement.

limited advertising presented in its iOS (Apple) and Android (Google) mobile applications to ads it sells directly. NYT limited advertising presented in its iOS (Apple) and Android (Google) mobile applications to ads it sells directly. NYT
2020 Annual Report, p. 12. 2020 Annual Report, p. 12.
79 Competition and Markets Authority (CMA), United Kingdom, 79 Competition and Markets Authority (CMA), United Kingdom, Online Platforms and Digital Advertising, Market , Market
Study Final Report, London, UK, July 2020, Appendix M, p. M5, at https://www.gov.uk/cma-cases/online-platforms-Study Final Report, London, UK, July 2020, Appendix M, p. M5, at https://www.gov.uk/cma-cases/online-platforms-
and-digital-advertising-market-study#final-report (July 2020 CMA Report). and-digital-advertising-market-study#final-report (July 2020 CMA Report).
80 Stewart, Bonita, Vice President, Global Partnerships, Google, “A Look at How News Publishers Make Money with 80 Stewart, Bonita, Vice President, Global Partnerships, Google, “A Look at How News Publishers Make Money with
Google Ad Manager,” Google Ad Manager (blog), Google, June 23, 2020, at https://blog.google/products/admanager/Google Ad Manager,” Google Ad Manager (blog), Google, June 23, 2020, at https://blog.google/products/admanager/
news-publishers-make-money-ad-manager/. news-publishers-make-money-ad-manager/.
81 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶42. 81 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶42.
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Figure 6. Display Advertising Sold via Indirect Advertising

Source: St. Paul Pioneer Press, November 15, 2021, at https://www.twincities.com/2021/11/15/design-picked-for-, November 15, 2021, at https://www.twincities.com/2021/11/15/design-picked-for-
new-rice-street-in-st-paul/. new-rice-street-in-st-paul/.
Most online publishers in the United States sell at least some of their inventory to advertisers Most online publishers in the United States sell at least some of their inventory to advertisers
indirectly. However, smaller publishers, including those of local newspapers, are more likely than indirectly. However, smaller publishers, including those of local newspapers, are more likely than
large publishers to rely exclusively on the indirect programmatic sales process. As the Australian large publishers to rely exclusively on the indirect programmatic sales process. As the Australian
Competition and Consumer Commission (ACCC), in its December 2020 interim report, Competition and Consumer Commission (ACCC), in its December 2020 interim report,
~~explained,~~explained
For many small advertisers and publishers that currently engage in the ad tech supply For many small advertisers and publishers that currently engage in the ad tech supply
chain, the costs involved in relying onchain, the costs involved in relying on direct negotiation for a large proportion of their direct negotiation for a large proportion of their
display advertising may be prohibitive.... [I]n comparison to selling via the ad tech supply display advertising may be prohibitive.... [I]n comparison to selling via the ad tech supply
chain, many publishers may not have the time, resources or expertise to sell all ad inventory chain, many publishers may not have the time, resources or expertise to sell all ad inventory
on [their] website[s] via direct deals and programmatic direct. As such, publishers may lose on [their] website[s] via direct deals and programmatic direct. As such, publishers may lose
potential revenue if they do not also sell inventory via the ad tech supply chain.82 potential revenue if they do not also sell inventory via the ad tech supply chain.82
Several studies, using various methodologies, indicate that publishers keep only 49% to 67% of Several studies, using various methodologies, indicate that publishers keep only 49% to 67% of
indirect programmatic advertising spending.83 The remaining revenue flows to ad technology (“ad indirect programmatic advertising spending.83 The remaining revenue flows to ad technology (“ad
tech”) intermediaries. The extreme complexity of the indirect programmatic advertising sales tech”) intermediaries. The extreme complexity of the indirect programmatic advertising sales
process contributes to what a British study describes as “a markedly opaque supply chain.”84 process contributes to what a British study describes as “a markedly opaque supply chain.”84
According to the December 2020 ACCC Interim Report, “The opaque and complex nature of the According to the December 2020 ACCC Interim Report, “The opaque and complex nature of the
ad tech supply chain can mean that ... [i]t may ... be difficult for stakeholders to know whether ad tech supply chain can mean that ... [i]t may ... be difficult for stakeholders to know whether
[ad-tech intermediaries are engaging in] conduct such as self-preferencing.” [ad-tech intermediaries are engaging in] conduct such as self-preferencing.”

82 Australian Competition and Consumer Commission (ACCC), 82 Australian Competition and Consumer Commission (ACCC), Digital Advertising Services Inquiry, Interim Report, , Interim Report,
Canberra, December 2020, p. 115, at https://www.accc.gov.au/focus-areas/inquiries-ongoing/digital-advertising-Canberra, December 2020, p. 115, at https://www.accc.gov.au/focus-areas/inquiries-ongoing/digital-advertising-
services-inquiry. (December 2020 ACCC Interim Report.) services-inquiry. (December 2020 ACCC Interim Report.)
83 Incorporated Society of British Advertisers (ISBA) and Pricewaterhouse Coopers LLP (PwC), 83 Incorporated Society of British Advertisers (ISBA) and Pricewaterhouse Coopers LLP (PwC), ISBA Programmatic
Supply Chain Transparency Study, London, UK, May 2020, p. 8, at https://www.isba.org.uk/media/2424/executive-, London, UK, May 2020, p. 8, at https://www.isba.org.uk/media/2424/executive-
summary-programmatic-supply-chain-transparency-study.pdf (ISBA and PwC May 2020 Study); Amy He, summary-programmatic-supply-chain-transparency-study.pdf (ISBA and PwC May 2020 Study); Amy He,
“eMarketer’s New Ad Tech Tax Estimates that Nearly One-Third of Spending Goes to Intermediaries,” “eMarketer’s New Ad Tech Tax Estimates that Nearly One-Third of Spending Goes to Intermediaries,” eMarketer, ,
August 5, 2019, at https://www.emarketer.com/content/emarketer-s-new-ad-tech-tax-estimates-show-one-third-of-August 5, 2019, at https://www.emarketer.com/content/emarketer-s-new-ad-tech-tax-estimates-show-one-third-of-
spending-goes-to-intermediaries. The variance is based on different methodologies. spending-goes-to-intermediaries. The variance is based on different methodologies.
84 ISBA and PwC May 2020 Study, p. 7. 84 ISBA and PwC May 2020 Study, p. 7.
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In an effort to enable newspaper publishers to keep more digital advertising revenue that would In an effort to enable newspaper publishers to keep more digital advertising revenue that would
otherwise flow to ad tech intermediaries, an independent advertising agency launched a campaign otherwise flow to ad tech intermediaries, an independent advertising agency launched a campaign
in February 2021 to encourage U.S. companies to, among other actions, pledge to reallocate 20% in February 2021 to encourage U.S. companies to, among other actions, pledge to reallocate 20%
of their programmatic advertising budgets directly to local news sources.85 of their programmatic advertising budgets directly to local news sources.85
Allegations of Anticompetitive Behavior
Google’s Role in Advertising Technology Stack
AAs Figure 7 illustrates, Google has a presence in each component of the tools and software that illustrates, Google has a presence in each component of the tools and software that
publishers and advertisers use to transmit online advertisements to users, also known as the publishers and advertisers use to transmit online advertisements to users, also known as the
“advertising technology stack.” State and foreign government officials allege that Google’s “advertising technology stack.” State and foreign government officials allege that Google’s
various roles in the advertising technology stack incentivize and enable it to prioritize its own various roles in the advertising technology stack incentivize and enable it to prioritize its own
interests above those of its customers, including newspaper publishers and advertisers, and interests above those of its customers, including newspaper publishers and advertisers, and
generate higher fees than it could in a competitive market. generate higher fees than it could in a competitive market.
Figure 7. Google’s Presence in Advertising Technology Stack

Source: CRS analysis of data from December 2020 ACCC Interim Report. See also Jon Fletcher, “How to Use CRS analysis of data from December 2020 ACCC Interim Report. See also Jon Fletcher, “How to Use
Google Ad Manager as Publisher,” Marfeel. October 15, 2020, at https://www.marfeel.com/resources/blog/use-Google Ad Manager as Publisher,” Marfeel. October 15, 2020, at https://www.marfeel.com/resources/blog/use-
google-ad-manager-as-a-publisher. google-ad-manager-as-a-publisher.
Note: Some advertisers work with ad agencies to purchase online advertisements, while others do not. Some advertisers work with ad agencies to purchase online advertisements, while others do not.

85 Alison Weissbrot, “Indie Agency Allen & Gerritsen Urges Ad Industry to Support Local News,” 85 Alison Weissbrot, “Indie Agency Allen & Gerritsen Urges Ad Industry to Support Local News,” Campaign, ,
February 18, 2021, at https://www.campaignlive.com/article/indie-agency-allen-gerritsen-urges-ad-industry-support-February 18, 2021, at https://www.campaignlive.com/article/indie-agency-allen-gerritsen-urges-ad-industry-support-
local-news/1707799. See also Allen & Gerritsen, “Protect Our Press,” at https://protectourpress.org/thepledge. local-news/1707799. See also Allen & Gerritsen, “Protect Our Press,” at https://protectourpress.org/thepledge.
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Components of Advertising Technology Stack
Ad servers store and manage ads from across different ad campaigns to automatically decide store and manage ads from across different ad campaigns to automatically decide
which ads to serve to which visitors on certain web pages, and to gather data about how users which ads to serve to which visitors on certain web pages, and to gather data about how users
interact with the ads displayed to them.86 Publishers tend to focus on using ad servers to manage interact with the ads displayed to them.86 Publishers tend to focus on using ad servers to manage
their ad inventory and reporting, while advertisers tend to focus on using them for managing the their ad inventory and reporting, while advertisers tend to focus on using them for managing the
creative features of their advertising campaigns. creative features of their advertising campaigns.
An An ad exchange is a digital marketplace that enables advertisers and publishers to buy and sell is a digital marketplace that enables advertisers and publishers to buy and sell
display and mobile advertising inventory, often through real-time auctions.87 Ad exchanges that display and mobile advertising inventory, often through real-time auctions.87 Ad exchanges that
serve the interests of both publishers and advertisers are both transparent and neutral when serve the interests of both publishers and advertisers are both transparent and neutral when
routing information about the parties’ asking and bidding prices. routing information about the parties’ asking and bidding prices.
A A supply side platform (SSP) is a piece of software used to sell publishers’ online advertising is a piece of software used to sell publishers’ online advertising
inventory. inventory.
Google integrates its publisher ad server and SSP in its “Ad Manager” product.88 Other Google integrates its publisher ad server and SSP in its “Ad Manager” product.88 Other
companies integrate these two pieces of technology as well. Nevertheless, ad servers and SSPs companies integrate these two pieces of technology as well. Nevertheless, ad servers and SSPs
perform separate functions. While SSPs focus on allowing publishers to conveniently sell their perform separate functions. While SSPs focus on allowing publishers to conveniently sell their
remnant ad space, ad servers are what ultimately allow an advertiser’s ads to be served to a remnant ad space, ad servers are what ultimately allow an advertiser’s ads to be served to a
publisher’s website.89 publisher’s website.89
SSPs that act in publishers’ interests connect the publishers to multiple exchanges, allowing a SSPs that act in publishers’ interests connect the publishers to multiple exchanges, allowing a
range of potential buyers to purchase advertising space. As described in range of potential buyers to purchase advertising space. As described in “Allegations Regarding
Google’s Conduct” the state attorneys general contend that by preventing publishers from doing the state attorneys general contend that by preventing publishers from doing
this, Google enabled its Ad Manager product to prioritize its own interests over those of this, Google enabled its Ad Manager product to prioritize its own interests over those of
publishers. publishers.
A A demand side platform (DSP) is a piece of software used by advertisers (or their agencies) to is a piece of software used by advertisers (or their agencies) to
buy online advertising inventory in an automated fashion. DSPs allow advertisers to buy buy online advertising inventory in an automated fashion. DSPs allow advertisers to buy
impressions targeted to specific users across a range of publisher sites, via multiple exchanges.90 impressions targeted to specific users across a range of publisher sites, via multiple exchanges.90
DSPs acting in advertisers’ interests enable them to buy a wide range ad inventory at the lowest DSPs acting in advertisers’ interests enable them to buy a wide range ad inventory at the lowest
possible price.91 Similarly to SSPs, many DSPs integrate advertiser ad server functions.92 possible price.91 Similarly to SSPs, many DSPs integrate advertiser ad server functions.92
An An ad network is an aggregator that purchases ad inventory from smaller publishers and then is an aggregator that purchases ad inventory from smaller publishers and then
resells it to advertisers.93 The network enables advertisers to reach users across many publishing resells it to advertisers.93 The network enables advertisers to reach users across many publishing
sites (e.g., local newspapers’ sites) that are not sufficiently large to trade their inventory in an sites (e.g., local newspapers’ sites) that are not sufficiently large to trade their inventory in an
exchange. Examples of ad networks featuring newspapers include the USA TODAY Network, a exchange. Examples of ad networks featuring newspapers include the USA TODAY Network, a
joint venture of Gannett and McClatchy,94 and Zeus Prime, which includes newspaper websites joint venture of Gannett and McClatchy,94 and Zeus Prime, which includes newspaper websites

86 “Ad Servers vs. DSPs, SSPs, DMPs & CDPS: Differences Clarified,” General (blog), AdButler, March 31, 2021, at 86 “Ad Servers vs. DSPs, SSPs, DMPs & CDPS: Differences Clarified,” General (blog), AdButler, March 31, 2021, at
https://www.adbutler.com/blog/article/ad-servers-vs-dsp-vs-ssp-vs-dmp-vs-cdp-vs-crm (March 2021 AdButler blog). https://www.adbutler.com/blog/article/ad-servers-vs-dsp-vs-ssp-vs-dmp-vs-cdp-vs-crm (March 2021 AdButler blog).
87 Jack Marshall, “WTF Is an ad exchange?,” 87 Jack Marshall, “WTF Is an ad exchange?,” Digiday, January 30, 2014, at https://digiday.com/media/what-is-an-ad-, January 30, 2014, at https://digiday.com/media/what-is-an-ad-
exchange/. exchange/.
88 December 2020 ACCC Interim Report, p. 168. 88 December 2020 ACCC Interim Report, p. 168.
89 March 2021 AdButler blog. 89 March 2021 AdButler blog.
90 “What the Tech Are DSPs, SSPs, and DMPs?,” Data-Driven 101 (blog), The TradeDesk. March 30, 2021, at 90 “What the Tech Are DSPs, SSPs, and DMPs?,” Data-Driven 101 (blog), The TradeDesk. March 30, 2021, at
https://www.thetradedesk.com/us/news/what-the-tech-are-dsps-ssps-and-dmps. https://www.thetradedesk.com/us/news/what-the-tech-are-dsps-ssps-and-dmps.
91 December 2020 ACCC Interim Report, p. 15. 91 December 2020 ACCC Interim Report, p. 15.
92 March 2021 AdButler blog. 92 March 2021 AdButler blog.
93 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶65. 93 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶65.
94 USA TODAY Network, “Gannett and McClatchy Collaborate to Offer Local Reach for National Advertisers,” press 94 USA TODAY Network, “Gannett and McClatchy Collaborate to Offer Local Reach for National Advertisers,” press
~~release, February 16, 2021, at https://www.usatoday.com/story/news/pr/2021/02/16/gannett-and-mcclatchy-collaborate-~~
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owned by the owned by the Washington Post, the , the Dallas Morning News, Tribune Publishing, MediaNews , Tribune Publishing, MediaNews
Group, and McClatchy.95 Google operates its own network, called Google Display Network, Group, and McClatchy.95 Google operates its own network, called Google Display Network,
which is composed of Google properties such as YouTube, Gmail, and millions of third-party which is composed of Google properties such as YouTube, Gmail, and millions of third-party
publisher sites.96 AdMob is Google’s mobile ad network for apps.97 publisher sites.96 AdMob is Google’s mobile ad network for apps.97
Allegations Regarding Google’s Conduct
In 2021, attorneys general from 16 states and the Commonwealth of Puerto Rico, led by Texas In 2021, attorneys general from 16 states and the Commonwealth of Puerto Rico, led by Texas
Attorney General Ken Paxton, filed suit against Google LLC, alleging the company’s conduct in Attorney General Ken Paxton, filed suit against Google LLC, alleging the company’s conduct in
the advertising technology stack violated antitrust laws.98 In August 2021, the Judicial Panel on the advertising technology stack violated antitrust laws.98 In August 2021, the Judicial Panel on
Multidistrict Litigation consolidated 20 display advertising monopoly suits against Google, Multidistrict Litigation consolidated 20 display advertising monopoly suits against Google,
including the Texas-led case and several from newspaper publishers and advertisers, for pretrial including the Texas-led case and several from newspaper publishers and advertisers, for pretrial
purposes.99 In January 2022, Google filed a motion to dismiss the lawsuit, claiming that purposes.99 In January 2022, Google filed a motion to dismiss the lawsuit, claiming that (1) the 1) the
regulators are attempting to stifle market forces, and regulators are attempting to stifle market forces, and (2) the regulators waited too long to file 2) the regulators waited too long to file
suit.100 suit.100
According to the lawsuit, prior to Google’s entrance into the publisher “ad server”/SSP market,101 According to the lawsuit, prior to Google’s entrance into the publisher “ad server”/SSP market,101
ad servers neutrally routed publishers’ ad inventory to different competing exchanges.102 The ad servers neutrally routed publishers’ ad inventory to different competing exchanges.102 The
lawsuit asserts that Google’s conduct substantially changed the ad server market. One year after lawsuit asserts that Google’s conduct substantially changed the ad server market. One year after
Google entered the advertising technology industry in 2008 with its purchase of DoubleClick, an Google entered the advertising technology industry in 2008 with its purchase of DoubleClick, an
online advertising company, the company introduced a new system called Dynamic Allocation to online advertising company, the company introduced a new system called Dynamic Allocation to
change the way ad servers sold inventory on behalf of publishers’ websites.103 change the way ad servers sold inventory on behalf of publishers’ websites.103
Before Google introduced Dynamic Allocation, newspaper publishers sold their ad inventory via Before Google introduced Dynamic Allocation, newspaper publishers sold their ad inventory via
a “waterfall” process conducted on their ad servers.104 If an ad impression was available, the a “waterfall” process conducted on their ad servers.104 If an ad impression was available, the
~~publisher’s ad server would first check to see whether there were any direct programmatic deals~~

release, February 16, 2021, at https://www.usatoday.com/story/news/pr/2021/02/16/gannett-and-mcclatchy-collaborate-offer-local-reach-national-advertisers/6743048002/. offer-local-reach-national-advertisers/6743048002/.
95 Max Willens, “They’re Solving a Problem: The Washington Post Readies Its Zeus Platform for the Buy Side,” 95 Max Willens, “They’re Solving a Problem: The Washington Post Readies Its Zeus Platform for the Buy Side,”
Digiday, March 8, 2021, at https://digiday.com/media/theyre-solving-a-problem-the-washington-post-readies-its-zeus-, March 8, 2021, at https://digiday.com/media/theyre-solving-a-problem-the-washington-post-readies-its-zeus-
platform-for-the-buy-side/. platform-for-the-buy-side/.
96 Google, Google Ads Help, “Google Display Network and YouTube on computers, mobile devices, and tablets,” at 96 Google, Google Ads Help, “Google Display Network and YouTube on computers, mobile devices, and tablets,” at
https://support.google.com/google-ads/answer/2740623?hl=en. https://support.google.com/google-ads/answer/2740623?hl=en.
97 Google, Google AdMob, “Earn more revenue with your apps,” at https://admob.google.com/home/?gclid= 97 Google, Google AdMob, “Earn more revenue with your apps,” at https://admob.google.com/home/?gclid=
EAIaIQobChMImOXXlOuq9QIVVuHICh0xQw5WEAAYASAAEgLDHPD_BwE&gclsrc=aw.ds. EAIaIQobChMImOXXlOuq9QIVVuHICh0xQw5WEAAYASAAEgLDHPD_BwE&gclsrc=aw.ds.
98 Texas, et al. v. Google, January 2022 3rd Amended Complaint. As of January 2022, the states represented include the 98 Texas, et al. v. Google, January 2022 3rd Amended Complaint. As of January 2022, the states represented include the
following: Texas, Alaska, Arkansas, Florida, Idaho, Indiana, Kentucky, Louisiana, Mississippi, Montana, North following: Texas, Alaska, Arkansas, Florida, Idaho, Indiana, Kentucky, Louisiana, Mississippi, Montana, North
Dakota, South Carolina, South Dakota, and Utah. Dakota, South Carolina, South Dakota, and Utah.
99 The consolidated case is In Re: Google Digital Advertising Antitrust Litigation, no. 1:21-cv-0703 (S.D.N.Y.). 99 The consolidated case is In Re: Google Digital Advertising Antitrust Litigation, no. 1:21-cv-0703 (S.D.N.Y.).
Matthew Perlman, “State AGs Update Google Display Monopoly Case,” Matthew Perlman, “State AGs Update Google Display Monopoly Case,” Law 360, November 15, 2021. , November 15, 2021.
100 Defendant Google LLC’s Memorandum of Law in Support of Its Motion to Dismiss Counts I Through IV of State 100 Defendant Google LLC’s Memorandum of Law in Support of Its Motion to Dismiss Counts I Through IV of State
Plaintiffs’ Third Amended Complaint, Plaintiffs’ Third Amended Complaint, State of Texas, et al. v. Google LLC, No. 21-CV-6841 (S.D.N.Y. January 21, , No. 21-CV-6841 (S.D.N.Y. January 21,
2022). 2022).
101 Because Google integrates its ad server and SSP services, the terms “ad server” and “ad server market” in this 101 Because Google integrates its ad server and SSP services, the terms “ad server” and “ad server market” in this
lawsuit include SSPs as well. lawsuit include SSPs as well.
102 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶56. 102 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶56.
103 December 2020 ACCC Interim Report, pp. 19-20. See also Louise Story and Miguel Helft, “Google Buys 103 December 2020 ACCC Interim Report, pp. 19-20. See also Louise Story and Miguel Helft, “Google Buys
DoubleClick for $4.1 Billion,” DoubleClick for $4.1 Billion,” New York Times, April 14, 2007, at https://www.nytimes.com/2007/04/14/technology/, April 14, 2007, at https://www.nytimes.com/2007/04/14/technology/
14DoubleClick.html. (“For months, Google has been trying to expand its foothold in online advertising into display 14DoubleClick.html. (“For months, Google has been trying to expand its foothold in online advertising into display
ads, the area where DoubleClick is strongest. Google made its name and still generates most of its revenue from search ads, the area where DoubleClick is strongest. Google made its name and still generates most of its revenue from search
and contextual text ads.”) and contextual text ads.”)
104 August 2021 ACCC Final Report, pp. 105-106. 104 August 2021 ACCC Final Report, pp. 105-106.
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publisher’s ad server would first check to see whether there were any direct programmatic deals in place that needed to be fulfilled. If there were no direct programmatic deals or if they had in place that needed to be fulfilled. If there were no direct programmatic deals or if they had
already been fulfilled, the publisher’s ad server would then offer the ad impression to SSPs, one already been fulfilled, the publisher’s ad server would then offer the ad impression to SSPs, one
at a time, in a set order determined by the publisher. Publishers set the order of SSPs based on at a time, in a set order determined by the publisher. Publishers set the order of SSPs based on
what they estimated each SSP would bid (based on its historical bids). The publisher ad server what they estimated each SSP would bid (based on its historical bids). The publisher ad server
would then call each SSP in sequence, with each having the ability to submit a real-time bid for would then call each SSP in sequence, with each having the ability to submit a real-time bid for
the ad impression. This process would continue until an SSP purchased the ad impression the ad impression. This process would continue until an SSP purchased the ad impression
(generally when an SSP submitted a bid higher than the price floor set by the publisher) or no (generally when an SSP submitted a bid higher than the price floor set by the publisher) or no
SSPs were left to bid. SSPs were left to bid.
Under Dynamic Allocation, in contrast, Google’s publisher ad server would take the publishers’ Under Dynamic Allocation, in contrast, Google’s publisher ad server would take the publishers’
estimated bids before each SSP received the bids, and set the highest estimated bid as a price estimated bids before each SSP received the bids, and set the highest estimated bid as a price
floor. According to one trade publication, “dynamic allocation had been a way for Google to offer floor. According to one trade publication, “dynamic allocation had been a way for Google to offer
advertisers on its exchange a way to swoop into auctions for ad space and buy the best inventory advertisers on its exchange a way to swoop into auctions for ad space and buy the best inventory
if they could beat the going market rate.”105 if they could beat the going market rate.”105
As long as Google’s SSP was willing to bid $0.01 per thousand impressions higher than the As long as Google’s SSP was willing to bid $0.01 per thousand impressions higher than the
publisher’s price floor, it could win the auction, even if competing SSPs were willing to bid publisher’s price floor, it could win the auction, even if competing SSPs were willing to bid
substantially more. This practice enabled Google to divert transactions that might otherwise have substantially more. This practice enabled Google to divert transactions that might otherwise have
been executed via its rivals’ advertising technology products, thereby both increasing its market been executed via its rivals’ advertising technology products, thereby both increasing its market
share and reducing publishers’ revenues.106 share and reducing publishers’ revenues.106
Response to Competition from Header Bidding
In response, in 2015, many publishers began to adopt an alternative system of conducting In response, in 2015, many publishers began to adopt an alternative system of conducting
auctions, called “header bidding.” The term comes from the practice of publishers (either auctions, called “header bidding.” The term comes from the practice of publishers (either
internally or via an intermediary)107 inserting JavaScript in advertising “headers” at the tops of internally or via an intermediary)107 inserting JavaScript in advertising “headers” at the tops of
their web pages.108 their web pages.108
With this system, publishers can simultaneously offer inventory to multiple exchanges and then With this system, publishers can simultaneously offer inventory to multiple exchanges and then
sell to the highest bidder.109 After adopting header bidding, the attorneys general lawsuit asserts, sell to the highest bidder.109 After adopting header bidding, the attorneys general lawsuit asserts,
some publishers’ revenues increased by 40%.110 Header bidding enabled publishers to bypass some publishers’ revenues increased by 40%.110 Header bidding enabled publishers to bypass
Google’s ad exchange, thereby enabling them to forgo paying fees to Google. It also decreased Google’s ad exchange, thereby enabling them to forgo paying fees to Google. It also decreased
the data available to Google via its various roles in the ad tech stack.111 the data available to Google via its various roles in the ad tech stack.111
~~Nevertheless, header bidding poses challenges for publishers. For example, the addition of extra~~
~~code on their web pages can slow down the time for them to load, thereby detracting from~~
~~consumers’ experiences.~~

105 Garett Sloane, “WTF is dynamic allocation?,” 105 Garett Sloane, “WTF is dynamic allocation?,” Digiday, April 14, 2016, at https://digiday.com/media/wtf-dynamic-, April 14, 2016, at https://digiday.com/media/wtf-dynamic-
allocation-google-ad-auctions/. allocation-google-ad-auctions/.
106 Ibid. 106 Ibid.
107 Marcin Ekiert, CEO and CoFounder, Yieldbird, “To Outsource, or to Opt for InHouse? Key Questions Regarding 107 Marcin Ekiert, CEO and CoFounder, Yieldbird, “To Outsource, or to Opt for InHouse? Key Questions Regarding
Header Building,” Ad Tech (blog), Yieldbird, August 25, 2020, at https://yieldbird.com/to-outsource-or-to-opt-for-in-Header Building,” Ad Tech (blog), Yieldbird, August 25, 2020, at https://yieldbird.com/to-outsource-or-to-opt-for-in-
house-key-questions-regarding-header-bidding/. house-key-questions-regarding-header-bidding/.
108 Kate Shokurova, “Website Header Design in 2020: Best Practices and Examples,” 108 Kate Shokurova, “Website Header Design in 2020: Best Practices and Examples,” UX Planet, February 10, 2020, at , February 10, 2020, at
https://uxplanet.org/website-header-design-in-2020-best-practices-and-examples-1992f80ddd69. https://uxplanet.org/website-header-design-in-2020-best-practices-and-examples-1992f80ddd69.
109 Ross Benes, “An Ad Tech Urban Legend: An Oral History of How Header Bidding Became Digital Advertising’s 109 Ross Benes, “An Ad Tech Urban Legend: An Oral History of How Header Bidding Became Digital Advertising’s
Biggest Buzzword,” Biggest Buzzword,” Digiday, June 16, 2017, at https://digiday.com/media/header-bidding-oral-history/. , June 16, 2017, at https://digiday.com/media/header-bidding-oral-history/.
110 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶358. 110 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶358.
111 Seb Joseph, “Ad Execs Dismayed, but Not Surprised by Tactics Google Allegedly Used to Control Ad Dollars,” 111 Seb Joseph, “Ad Execs Dismayed, but Not Surprised by Tactics Google Allegedly Used to Control Ad Dollars,”
Digiday, October 21, 2021, at https://digiday.com/marketing/ad-execs-dismayed-but-not-surprised-by-new-alleged-, October 21, 2021, at https://digiday.com/marketing/ad-execs-dismayed-but-not-surprised-by-new-alleged-
actions-against-google-to-curtail-digital-ad-revenue/. actions-against-google-to-curtail-digital-ad-revenue/.
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Nevertheless, header bidding poses challenges for publishers. For example, the addition of extra code on their web pages can slow down the time for them to load, thereby detracting from consumers’ experiences. Google chose not to participate in header bidding. Google contends that its decision was “not Google chose not to participate in header bidding. Google contends that its decision was “not
surprising given header bidding’s potential for adverse effects on users, advertisers and the surprising given header bidding’s potential for adverse effects on users, advertisers and the
ecosystem, and the fact that Google already had an efficient auction mechanism with Dynamic ecosystem, and the fact that Google already had an efficient auction mechanism with Dynamic
Allocation and [its SSP/ad exchange, then known as AdX], in which many different Google-Allocation and [its SSP/ad exchange, then known as AdX], in which many different Google-
owned and third-party ad buyers competed.”112 owned and third-party ad buyers competed.”112
In their lawsuit, however, the state attorneys general contend, “Based on a review of Google’s In their lawsuit, however, the state attorneys general contend, “Based on a review of Google’s
internal documents, Google wanted to quash header bidding innovation for three reasons: (1) to internal documents, Google wanted to quash header bidding innovation for three reasons: (1) to
maintain its publisher ad serving monopoly; (2) to continue using its control of publishers’ ad maintain its publisher ad serving monopoly; (2) to continue using its control of publishers’ ad
server to preference its exchange and buying tools; and (3) to avoid price competition in the server to preference its exchange and buying tools; and (3) to avoid price competition in the
exchange market.”113 exchange market.”113
They further claim that Google “punish[ed]” publishers who attempted to use header bidding by They further claim that Google “punish[ed]” publishers who attempted to use header bidding by
placing them in a lower position in its search engine results, thereby cutting off an important placing them in a lower position in its search engine results, thereby cutting off an important
source of visitor traffic.114 As described in source of visitor traffic.114 As described in “Google: Alleged Monopolization of Search Engine,” ”
the U.S. Department of Justice (DOJ) has alleged that Google has engaged in anticompetitive the U.S. Department of Justice (DOJ) has alleged that Google has engaged in anticompetitive
behavior to monopolize the search engine market. behavior to monopolize the search engine market.
Google’s Introduction and Promotion of Open Exchange
Google introduced its own proprietary version of server-side header bidding, now known as Google introduced its own proprietary version of server-side header bidding, now known as
“Open Exchange,” and made it available to publishers in April 2018. According to the United “Open Exchange,” and made it available to publishers in April 2018. According to the United
Kingdom’s Competition and Markets Authority, Google’s internal documents indicate that its Kingdom’s Competition and Markets Authority, Google’s internal documents indicate that its
major motivation was to protect the company’s revenues from the impact of header bidding.115 major motivation was to protect the company’s revenues from the impact of header bidding.115
In their lawsuit, the state attorneys general allege, quoting documents from Google, that In their lawsuit, the state attorneys general allege, quoting documents from Google, that
“although Google executives once considered ‘creating a completely neutral platform like the “although Google executives once considered ‘creating a completely neutral platform like the
[New York Stock Exchange],’ they instead chose to ‘stack the deck in favor of Google [demand]’ [New York Stock Exchange],’ they instead chose to ‘stack the deck in favor of Google [demand]’
by using control of [Open Exchange] to give preferred access to their own buying tools.”116 by using control of [Open Exchange] to give preferred access to their own buying tools.”116
In addition, the state attorneys general claim that “Google unlawfully excluded competition from In addition, the state attorneys general claim that “Google unlawfully excluded competition from
header bidding by getting its largest Big Tech rival, Facebook,117 to stop supporting the header bidding by getting its largest Big Tech rival, Facebook,117 to stop supporting the
technology” via an agreement dated September 2018 that violated antitrust laws.118 They statetechnology” via an agreement dated September 2018 that violated antitrust laws.118 They state,
The principal impetus for this deal began many months before, in March 2017, when The principal impetus for this deal began many months before, in March 2017, when
Facebook publicly announced it would support header bidding. By doing so, Facebook Facebook publicly announced it would support header bidding. By doing so, Facebook
would enable web and mobile app publishers and advertisers to bypass the fees associated would enable web and mobile app publishers and advertisers to bypass the fees associated
~~with transacting through Google’s ad server. Because header bidding cost nothing,~~

112 Bitton and Lewis, p. 19. 112 Bitton and Lewis, p. 19.
113 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶361. 113 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶361.
114 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶¶375, 408. 114 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶¶375, 408.
115 July 2020 CMA Report, Appendix M, pp. M10-M11. 115 July 2020 CMA Report, Appendix M, pp. M10-M11.
116 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶77. 116 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶77.
117 eMarketer estimates that in 2020, Facebook’s share of total online advertising in the United States (including all 117 eMarketer estimates that in 2020, Facebook’s share of total online advertising in the United States (including all
formats) was 25.2%, Google’s was 28.9%, and Amazon’s was 10.3%. “U.S. Triopoly Digital Ad Revenue Share by formats) was 25.2%, Google’s was 28.9%, and Amazon’s was 10.3%. “U.S. Triopoly Digital Ad Revenue Share by
Company, 2019 & 2020,” eMarketer, March 2021, at https://www.emarketer.com/chart/245872/us-triopoly-digital-ad-Company, 2019 & 2020,” eMarketer, March 2021, at https://www.emarketer.com/chart/245872/us-triopoly-digital-ad-
revenue-share-by-company-2019-2020-of-total-digital-ad-spending. revenue-share-by-company-2019-2020-of-total-digital-ad-spending.
118 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶¶ 413-450. They allege that Google and Facebook 118 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶¶ 413-450. They allege that Google and Facebook
CEOs Sundar Pichai and Mark Zuckerberg, respectively, personally approved this agreement. Ibid., ¶¶423-424. CEOs Sundar Pichai and Mark Zuckerberg, respectively, personally approved this agreement. Ibid., ¶¶423-424.
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with transacting through Google’s ad server. Because header bidding cost nothing, Facebook’s use of header bidding would let web publishers, mobile app publishers, and Facebook’s use of header bidding would let web publishers, mobile app publishers, and
advertisers save on these fees altogether.119 advertisers save on these fees altogether.119
Because of the September 2018 agreement, the state attorneys general claim that “Google [gave] Because of the September 2018 agreement, the state attorneys general claim that “Google [gave]
Facebook a leg up in its auctions in return for Facebook backing off from header bidding.”120 In Facebook a leg up in its auctions in return for Facebook backing off from header bidding.”120 In
September 2021, Senators Elizabeth Warren and Richard Blumenthal, as well as Representatives September 2021, Senators Elizabeth Warren and Richard Blumenthal, as well as Representatives
Pramila Jayapal and Mondaire Jones, called on DOJ to investigate whether Google and Pramila Jayapal and Mondaire Jones, called on DOJ to investigate whether Google and
Facebook’s agreement violated Section 1 of the Sherman Antitrust Act [15 U.S.C. §1].121 This Facebook’s agreement violated Section 1 of the Sherman Antitrust Act [15 U.S.C. §1].121 This
section criminalizes “mak[ing] any contract … in restraint of trade or commerce.” section criminalizes “mak[ing] any contract … in restraint of trade or commerce.”
In April 2021, publishers of 125 newspapers in 11 states filed or announced lawsuits against both In April 2021, publishers of 125 newspapers in 11 states filed or announced lawsuits against both
Google and Facebook, calling this arrangement between the two companies “an illegal secretive Google and Facebook, calling this arrangement between the two companies “an illegal secretive
deal” that “unlawfully monopolized the digital advertising market.”122 As of December 2021, the deal” that “unlawfully monopolized the digital advertising market.”122 As of December 2021, the
number of newspapers owned by publishers suing Google and Facebook has grown to 200.123 number of newspapers owned by publishers suing Google and Facebook has grown to 200.123
In a blog post, Google disputed the state attorneys generals’ allegations regarding its motivations In a blog post, Google disputed the state attorneys generals’ allegations regarding its motivations
for launching Open Bidding and entering into an agreement with Facebook.124 According to for launching Open Bidding and entering into an agreement with Facebook.124 According to
GoogleGoogle,
Open Bidding provides publishers access to demand from dozens of networks and Open Bidding provides publishers access to demand from dozens of networks and
exchanges. This helps increase demand for publisher inventory and competition for ad exchanges. This helps increase demand for publisher inventory and competition for ad
space, which enables publishers to drive more revenue.... [Texas] AG [Ken] Paxton space, which enables publishers to drive more revenue.... [Texas] AG [Ken] Paxton
inaccurately claims that we manipulate the Open Bidding auction in [Facebook’s] favor. inaccurately claims that we manipulate the Open Bidding auction in [Facebook’s] favor.
We absolutely don’t.... And AG Paxton’s claims about how much we charge other Open We absolutely don’t.... And AG Paxton’s claims about how much we charge other Open
Bidding partners are mistaken—our standard revenue share for Open Bidding is 5-10 Bidding partners are mistaken—our standard revenue share for Open Bidding is 5-10
percent. percent.
Google states that Open Bidding offers many features for publishers, including simplicity, ease of Google states that Open Bidding offers many features for publishers, including simplicity, ease of
use, and measures to protect users’ privacy.125 use, and measures to protect users’ privacy.125
Additional Allegations
The attorneys general further allege that Google had secretly manipulated the outcome of The attorneys general further allege that Google had secretly manipulated the outcome of
programmatic auctions for its own benefit.126 For example, in a program named Project Bernanke, programmatic auctions for its own benefit.126 For example, in a program named Project Bernanke,
after former Federal Reserve Board Chairman Ben Bernanke, Google allegedly used information after former Federal Reserve Board Chairman Ben Bernanke, Google allegedly used information
from past auction bids in its advertising exchange to give its own DSPs and ad exchanges from past auction bids in its advertising exchange to give its own DSPs and ad exchanges

119 Ibid., ¶414. 119 Ibid., ¶414.
120 Ibid., ¶¶427-436. 120 Ibid., ¶¶427-436.
121 Letter from Senator Elizabeth Warren, Senator Richard Blumenthal, Representative Pramila Jayapal, and 121 Letter from Senator Elizabeth Warren, Senator Richard Blumenthal, Representative Pramila Jayapal, and
Representative Mondaire Jones to The Honorable Merrick Garland, Attorney General, U.S. Department of Justice, and Representative Mondaire Jones to The Honorable Merrick Garland, Attorney General, U.S. Department of Justice, and
The Honorable Nicholas Ganjei, Acting U.S. Attorney, Eastern District of Texas, U.S. Department of Justice, The Honorable Nicholas Ganjei, Acting U.S. Attorney, Eastern District of Texas, U.S. Department of Justice,
September 1, 2021, at https://www.warren.senate.gov/download/20210830-letter-re-jedi-blue. September 1, 2021, at https://www.warren.senate.gov/download/20210830-letter-re-jedi-blue.
122 Fitzimmons Law Firm, PLLC, “Wave of Newspapers Sue Google and Facebook,” press release, April 20, 2021, at 122 Fitzimmons Law Firm, PLLC, “Wave of Newspapers Sue Google and Facebook,” press release, April 20, 2021, at
https://www.editorandpublisher.com/stories/wave-of-newspaper-publishers-sue-google-and-facebook,191224. https://www.editorandpublisher.com/stories/wave-of-newspaper-publishers-sue-google-and-facebook,191224.
123 Sara Fischer, Kristal Dixon, “Scoop: Over 200 Papers Quietly Sue Big Tech,” 123 Sara Fischer, Kristal Dixon, “Scoop: Over 200 Papers Quietly Sue Big Tech,” Axios, December 7, 2021, at , December 7, 2021, at
https://www.axios.com/1-local-newspapers-lawsuits-facebook-google-3c3dee3a-cce3-49ef-b0a2-7a98c2e15c91.html. https://www.axios.com/1-local-newspapers-lawsuits-facebook-google-3c3dee3a-cce3-49ef-b0a2-7a98c2e15c91.html.
124 Andy Cohen, Director, Economic Policy, Google. “AG Paxton’s Misleading Attacks on Our Ad Tech Business,” 124 Andy Cohen, Director, Economic Policy, Google. “AG Paxton’s Misleading Attacks on Our Ad Tech Business,”
January 21, 2021, at https://blog.google/products/admanager/news-publishers-make-money-ad-manager/. January 21, 2021, at https://blog.google/products/admanager/news-publishers-make-money-ad-manager/.
125 Bitton and Lewis, p. 20. 125 Bitton and Lewis, p. 20.
126 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶¶297-351. 126 Texas, et al. v. Google, January 2022 3rd Amended Complaint, ¶¶297-351.
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advantages over competitors.127 By ensuring that its ad tech tools processed the winning bid, advantages over competitors.127 By ensuring that its ad tech tools processed the winning bid,
Google received the transactions for its ad exchange and its DSP.128 Google received the transactions for its ad exchange and its DSP.128
Alleged Effects of Google’s Role in Advertising Technology Stack on
Newspaper Publishers
Authorities in several jurisdictions have alleged or are investigating allegations that Google has Authorities in several jurisdictions have alleged or are investigating allegations that Google has
leveraged market power in the advertising technology stack to thwart competition. leveraged market power in the advertising technology stack to thwart competition.
The United Kingdom’s Competition and Markets Authority estimated that large publishers using The United Kingdom’s Competition and Markets Authority estimated that large publishers using
Google’s ad server Ad Manager retain, on average, 70%-80% of advertising revenue received by Google’s ad server Ad Manager retain, on average, 70%-80% of advertising revenue received by
Google, whereas small publishers using Google’s ad server AdSense for Content retain, on Google, whereas small publishers using Google’s ad server AdSense for Content retain, on
average, 60%-70% “of the revenues earned by Google from advertisers.”129 The authority’s July average, 60%-70% “of the revenues earned by Google from advertisers.”129 The authority’s July
2020 report stated, “In acting simultaneously on behalf of publishers and advertisers, Google 2020 report stated, “In acting simultaneously on behalf of publishers and advertisers, Google
faces strong conflicts of interest. It has been able to leverage the market power from its owned-faces strong conflicts of interest. It has been able to leverage the market power from its owned-
and-operated advertising inventory [e.g., on YouTube] into the open display market and within and-operated advertising inventory [e.g., on YouTube] into the open display market and within
the ad tech stack, making it harder for third-party intermediaries to compete.”130 the ad tech stack, making it harder for third-party intermediaries to compete.”130
The Australian Competition and Consumer Commission, in its December 2020 interim report, The Australian Competition and Consumer Commission, in its December 2020 interim report,
stated that it had “received submissions during the course of the Inquiry alleging that Google’s stated that it had “received submissions during the course of the Inquiry alleging that Google’s
position across the [advertising technology stack] may have allowed Google to engage in conduct position across the [advertising technology stack] may have allowed Google to engage in conduct
which has limited competition in the supply of ad tech services.”131 which has limited competition in the supply of ad tech services.”131
In June 2021, France’s Autorité de la concurrence, following referrals from several newspaper In June 2021, France’s Autorité de la concurrence, following referrals from several newspaper
publishers, issued a decision publishers, issued a decision
sanctioning Google, up to 220 million euros, for having abused its dominant position in the sanctioning Google, up to 220 million euros, for having abused its dominant position in the
advertising server market for website and mobile applications publishers…. [T]he press advertising server market for website and mobile applications publishers…. [T]he press
groups—including those who were at the origin of the referral to the Autorité—were groups—including those who were at the origin of the referral to the Autorité—were
affected even though their economic model is also strongly weakened by the decline in affected even though their economic model is also strongly weakened by the decline in
sales of print subscriptions and the decline in associated advertising revenue.132 sales of print subscriptions and the decline in associated advertising revenue.132
Also in June 2021, the European Union’s European Commission Also in June 2021, the European Union’s European Commission
opened a formal antitrust investigation to assess whether Google has violated opened a formal antitrust investigation to assess whether Google has violated [European [European
Union] competition rules by favouring its own online display advertising technology Union] competition rules by favouring its own online display advertising technology
services in the so called “ad tech” [stack], to the detriment of competing providers of services in the so called “ad tech” [stack], to the detriment of competing providers of
advertising technology services, advertisers and online publishers. The formal advertising technology services, advertisers and online publishers. The formal
investigation will notably examine whether Google is distorting competition by restricting investigation will notably examine whether Google is distorting competition by restricting

127 Jeff Horwitz and Keach Hagey, “Google’s Secret ‘Project Bernanke’ Revealed in Texas Antitrust Case,” 127 Jeff Horwitz and Keach Hagey, “Google’s Secret ‘Project Bernanke’ Revealed in Texas Antitrust Case,” Wall Street
Journal, April 11, 2021, at https://www.wsj.com/articles/googles-secret-project-bernanke-revealed-in-texas-antitrust-, April 11, 2021, at https://www.wsj.com/articles/googles-secret-project-bernanke-revealed-in-texas-antitrust-
case-11618097760. case-11618097760.
128 Seb Joseph, “Ad Execs Dismayed, but Not Surprised by Tactics Google Allegedly Used to Control Ad Dollars,” 128 Seb Joseph, “Ad Execs Dismayed, but Not Surprised by Tactics Google Allegedly Used to Control Ad Dollars,”
Digiday, October 21, 2021, at https://digiday.com/marketing/ad-execs-dismayed-but-not-surprised-by-new-alleged-, October 21, 2021, at https://digiday.com/marketing/ad-execs-dismayed-but-not-surprised-by-new-alleged-
actions-against-google-to-curtail-digital-ad-revenue/. actions-against-google-to-curtail-digital-ad-revenue/.
129 July 2020 CMA Report, Appendix R, p. R14. 129 July 2020 CMA Report, Appendix R, p. R14.
130 Ibid., p. 211. 130 Ibid., p. 211.
131 December 2020 ACCC Interim Report, p. 15. 131 December 2020 ACCC Interim Report, p. 15.
132 Autorité de la concurrence, “Le Autorité de la Concurrence Hands out a €220 Million Fine to Google for Favoring 132 Autorité de la concurrence, “Le Autorité de la Concurrence Hands out a €220 Million Fine to Google for Favoring
Its Own Services in the Online Advertising Sector,” press release, June 7, 2021, at Its Own Services in the Online Advertising Sector,” press release, June 7, 2021, at
https://www.autoritedelaconcurrence.fr/en/press-release/autorite-de-la-concurrence-hands-out-eu220-millions-fine-https://www.autoritedelaconcurrence.fr/en/press-release/autorite-de-la-concurrence-hands-out-eu220-millions-fine-
google-favouring-its-own. google-favouring-its-own.
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access by third parties to user data for advertising purposes on websites and apps, while access by third parties to user data for advertising purposes on websites and apps, while
reserving such data for its own use.133 reserving such data for its own use.133
In their complaint, the state attorneys general allege, “Google’s conduct unlawfully forecloses In their complaint, the state attorneys general allege, “Google’s conduct unlawfully forecloses
competition in the markets for (1) publisher ad servers, (2) ad exchanges, (3) in-app networks, (4) competition in the markets for (1) publisher ad servers, (2) ad exchanges, (3) in-app networks, (4)
ad buying tools for large advertisers, and (5) ad buying tools for small advertisers.”134 ad buying tools for large advertisers, and (5) ad buying tools for small advertisers.”134
Additional Antitrust Lawsuits in the United States
Additional antitrust lawsuits, while less directly related to newspaper publishers, concern alleged Additional antitrust lawsuits, while less directly related to newspaper publishers, concern alleged
conduct that could affect publishers’ ability to maximize revenues from licensing and conduct that could affect publishers’ ability to maximize revenues from licensing and
subscriptions. subscriptions.
Facebook: Alleged Monopolization of Social Media
In August 2021, the Federal Trade Commission (FTC) filed an amended complaint against Meta In August 2021, the Federal Trade Commission (FTC) filed an amended complaint against Meta
Platforms alleging that its Facebook subsidiary had unlawfully sought to suppress competition to Platforms alleging that its Facebook subsidiary had unlawfully sought to suppress competition to
its social networking service by acquiring potential rivals such as the messaging platform its social networking service by acquiring potential rivals such as the messaging platform
WhatsApp and image-sharing app Instagram.135 In addition, the FTC asserts, Facebook WhatsApp and image-sharing app Instagram.135 In addition, the FTC asserts, Facebook
conditioned app developers’ access to its platform on the developers’ agreement to refrain from conditioned app developers’ access to its platform on the developers’ agreement to refrain from
competing with Facebook’s core services and from facilitating the growth of potential rivals to competing with Facebook’s core services and from facilitating the growth of potential rivals to
Facebook.136 The FTC requests that the U.S. District Court for the District of Columbia, among Facebook.136 The FTC requests that the U.S. District Court for the District of Columbia, among
other actions, require Facebook to divest assets, including Instagram and WhatsApp, in order to other actions, require Facebook to divest assets, including Instagram and WhatsApp, in order to
promote competition among personal social networking platforms. promote competition among personal social networking platforms.
Increased competition for Facebook could potentially decrease the relative bargaining power of Increased competition for Facebook could potentially decrease the relative bargaining power of
Facebook vis-à-vis newspaper publishers. Facebook vis-à-vis newspaper publishers.
Apple and Google: App Stores Policies
Apple and Google generally require that they be enabled by app developers to handle all Apple and Google generally require that they be enabled by app developers to handle all
payments for apps sold in Apple and Google’s respective app stores.137 Typically, for payments for apps sold in Apple and Google’s respective app stores.137 Typically, for
subscription-based apps, Apple collects a standard 30% commission during the first year on its subscription-based apps, Apple collects a standard 30% commission during the first year on its
App Store, and a 15% commission thereafter.138 In some instances, Apple makes exceptions to App Store, and a 15% commission thereafter.138 In some instances, Apple makes exceptions to
this policy. In November 2020, Apple announced that beginning in January 2021, small this policy. In November 2020, Apple announced that beginning in January 2021, small
businesses generating up to $1 million per year in revenues would need to pay only a 15% businesses generating up to $1 million per year in revenues would need to pay only a 15%

133 European Commission, “Antitrust: Commission Opens Investigation into Possible Anticompetitive Conduct by 133 European Commission, “Antitrust: Commission Opens Investigation into Possible Anticompetitive Conduct by
Google in the Online Advertising Technology Sector,” press release, June 22, 2021, at https://ec.europa.eu/Google in the Online Advertising Technology Sector,” press release, June 22, 2021, at https://ec.europa.eu/
commission/presscorner/detail/hu/ip_21_3143. commission/presscorner/detail/hu/ip_21_3143.
134 Texas, et al. v. Google, November 2022 3rd Amended Complaint, ¶244. 134 Texas, et al. v. Google, November 2022 3rd Amended Complaint, ¶244.
135 First Amended Complaint for Injunctive and Other Equitable Relief ¶¶2, 6-7 FTC v. Facebook, No. 1:20-cv-03590 135 First Amended Complaint for Injunctive and Other Equitable Relief ¶¶2, 6-7 FTC v. Facebook, No. 1:20-cv-03590
(D.D.C. August 19, 2021). The FTC filed an amended complaint after a federal judge dismissed the agency’s original (D.D.C. August 19, 2021). The FTC filed an amended complaint after a federal judge dismissed the agency’s original
lawsuit in June 2021, finding that the agency failed to sufficiently support its allegation that Facebook engaged in lawsuit in June 2021, finding that the agency failed to sufficiently support its allegation that Facebook engaged in
lawful monopolization of the personal social networking market was insufficient. FTC v. Facebook, Inc., No. 20-3590, lawful monopolization of the personal social networking market was insufficient. FTC v. Facebook, Inc., No. 20-3590,
2021 (D.D.C. June 28, 2021). 2021 (D.D.C. June 28, 2021).
136 First Amended Complaint, for Injunctive and Other Equitable Relief ¶8. 136 First Amended Complaint, for Injunctive and Other Equitable Relief ¶8.
137 Jack Nicas, Kellen Browning, and Erin Griffin, “Fortnite Creator Sues Apple and Google After Ban from App 137 Jack Nicas, Kellen Browning, and Erin Griffin, “Fortnite Creator Sues Apple and Google After Ban from App
Stores,” Stores,” New York Times, August 13, 2020. , August 13, 2020.
138 Sarah Perez, “Apple Lowers Commission on In-App Purchases for news Publishers Who Participate in Apple 138 Sarah Perez, “Apple Lowers Commission on In-App Purchases for news Publishers Who Participate in Apple
News,” News,” TechCrunch, August 26, 2021, at https://techcrunch.com/2021/08/26/apple-lowers-commissions-on-in-app-, August 26, 2021, at https://techcrunch.com/2021/08/26/apple-lowers-commissions-on-in-app-
purchases-for-news-publishers-who-participate-in-apple-news/. purchases-for-news-publishers-who-participate-in-apple-news/.
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commission in the first year as well.139 In March 2021, Google announced that it would follow commission in the first year as well.139 In March 2021, Google announced that it would follow
suit beginning in July 2021.140 In September 2021, Apple announced that it would reduce the suit beginning in July 2021.140 In September 2021, Apple announced that it would reduce the
initial year rate to 15% for news publishers that participate in the Apple News app and meet initial year rate to 15% for news publishers that participate in the Apple News app and meet
certain requirements.141 In October 2021, Google announced that it would decrease the certain requirements.141 In October 2021, Google announced that it would decrease the
commission for all subscriptions sold through the Google Play app store beginning on January 1, commission for all subscriptions sold through the Google Play app store beginning on January 1,
2022.142 2022.142
In August 2020, after Epic Games, the company that produces the video game Fortnite, In August 2020, after Epic Games, the company that produces the video game Fortnite,
encouraged mobile-app users to pay it directly rather than through Apple’s and Google’e app encouraged mobile-app users to pay it directly rather than through Apple’s and Google’e app
stores, both Apple and Google removed the Fortnite app from their stores.143 Epic filed lawsuits stores, both Apple and Google removed the Fortnite app from their stores.143 Epic filed lawsuits
against both Apple and Google, claiming that the companies engaged in anticompetitive behavior against both Apple and Google, claiming that the companies engaged in anticompetitive behavior
with respect to their app store policies.144 In September 2021, a California federal judge ordered with respect to their app store policies.144 In September 2021, a California federal judge ordered
Apple to permit Epic Games and other app developers to steer customers outside of its app store, Apple to permit Epic Games and other app developers to steer customers outside of its app store,
but permitted Apple to keep other restrictions in place.145 In November 2021, the judge directed but permitted Apple to keep other restrictions in place.145 In November 2021, the judge directed
Apple to end its anti-steering rules by December 9, 2021, even as Apple appeals the September Apple to end its anti-steering rules by December 9, 2021, even as Apple appeals the September
2021 decision.146 2021 decision.146
In July 2021, attorneys general from 36 states and Washington, DC, also filed an antitrust In July 2021, attorneys general from 36 states and Washington, DC, also filed an antitrust
complaint against Google. The complaint alleges that Google effectively forced Android users complaint against Google. The complaint alleges that Google effectively forced Android users
and application developers to use its app store while collecting an “extravagant commission” rate and application developers to use its app store while collecting an “extravagant commission” rate
of 30% of the price that consumers pay to purchase subscriptions within Google Play Store.”147 of 30% of the price that consumers pay to purchase subscriptions within Google Play Store.”147
Google and the parties suing it for allegedly monopolizing its Android Play store have agreed to a Google and the parties suing it for allegedly monopolizing its Android Play store have agreed to a
January 2023 trial.148 January 2023 trial.148
If the courts were to rule against Google and Apple in these cases, these platforms might have to If the courts were to rule against Google and Apple in these cases, these platforms might have to
lower the commissions they charge owners of apps, including newspaper publishers. In addition, lower the commissions they charge owners of apps, including newspaper publishers. In addition,

139 Sarah Perez, “Apple Dropping App Store Fees to 15% for Small Businesses with Under $1 Million in Revenues,” 139 Sarah Perez, “Apple Dropping App Store Fees to 15% for Small Businesses with Under $1 Million in Revenues,”
TechCrunch, November 18, 2020, at https://techcrunch.com/2020/11/18/apple-to-reduce-app-store-fees-for-small-, November 18, 2020, at https://techcrunch.com/2020/11/18/apple-to-reduce-app-store-fees-for-small-
businesses-with-under-1-million-in-revenues/. businesses-with-under-1-million-in-revenues/.
140 Sameer Samat, VP, Product Management, Android and Google, “Boosting Developer Success on Google Play,” 140 Sameer Samat, VP, Product Management, Android and Google, “Boosting Developer Success on Google Play,”
Android Developers Blog, March 16, 2021, at https://android-developers.googleblog.com/2021/03/boosting-dev-Android Developers Blog, March 16, 2021, at https://android-developers.googleblog.com/2021/03/boosting-dev-
success.html.success.html.
141 Apple Inc., “Apple Introduces the News Parnter Program,” press release, August 26, 2021, at 141 Apple Inc., “Apple Introduces the News Parnter Program,” press release, August 26, 2021, at
https://www.apple.com/newsroom/2021/08/apple-introduces-the-news-partner-program/. One year prior to Apple’s https://www.apple.com/newsroom/2021/08/apple-introduces-the-news-partner-program/. One year prior to Apple’s
announcement, a trade group representing newspaper publishers sent a letter to Apple requesting information about announcement, a trade group representing newspaper publishers sent a letter to Apple requesting information about
how to qualify for more favorable terms regarding distribution in the app store. Letter from Jason Kint, CEO, Digital how to qualify for more favorable terms regarding distribution in the app store. Letter from Jason Kint, CEO, Digital
Content Next, to Tim Cook, CEO, Apple, August 20, 2020, at https://digitalcontentnext.org/wp-content/uploads/2020/Content Next, to Tim Cook, CEO, Apple, August 20, 2020, at https://digitalcontentnext.org/wp-content/uploads/2020/
08/DCN-Letter-to-Apple-final.pdf. 08/DCN-Letter-to-Apple-final.pdf.
142 Sameer Samat, VP, Product Management, Android and Google, “Evolving Our Business Model to Address 142 Sameer Samat, VP, Product Management, Android and Google, “Evolving Our Business Model to Address
Developer Needs,” Android Developers Blog, October 21, 2021, at https://android-developers.googleblog.com/2021/Developer Needs,” Android Developers Blog, October 21, 2021, at https://android-developers.googleblog.com/2021/
10/evolving-business-model.html. 10/evolving-business-model.html.
143 Jack Nicas, Kellen Browning and Erin Griffin, “Fortnite Creator Sues Apple and Google After Ban from App 143 Jack Nicas, Kellen Browning and Erin Griffin, “Fortnite Creator Sues Apple and Google After Ban from App
Stores,” Stores,” New York Times, August 13, 2020. , August 13, 2020.
144 Motion for Temporary Restraining Order, Epic Games, Inc. v. Apple Inc., No. 3:20-cv-05640 (N.D. Cal. August 17, 144 Motion for Temporary Restraining Order, Epic Games, Inc. v. Apple Inc., No. 3:20-cv-05640 (N.D. Cal. August 17,
2020); Complaint for Injunctive Relief, Epic Games, Inc. v. Google LLC et al., No. 5:20-cv-05671 (N.D. Cal August 2020); Complaint for Injunctive Relief, Epic Games, Inc. v. Google LLC et al., No. 5:20-cv-05671 (N.D. Cal August
13, 2020). 13, 2020).
145 Epic Games, Inc. v. Apple Inc., No. 4:20-cv-05640-YGR, 2021 U.S. Dist. LEXIS 172303 (N.D. Cal. September 10, 145 Epic Games, Inc. v. Apple Inc., No. 4:20-cv-05640-YGR, 2021 U.S. Dist. LEXIS 172303 (N.D. Cal. September 10,
2021). 2021).
146 Epic Games v. Apple Inc., No. 4:20-cv-05640-YGR, 2021 U.S. Dist. LEXIS 220266 (N.D. Cal. November 9, 2021). 146 Epic Games v. Apple Inc., No. 4:20-cv-05640-YGR, 2021 U.S. Dist. LEXIS 220266 (N.D. Cal. November 9, 2021).
147 Complaint ¶¶3-4, 147 Complaint ¶¶3-4, State of Utah, et al. v. Google et al., No. 3:21-cv-05227 (N.D. Cal. July 7, 2021). , No. 3:21-cv-05227 (N.D. Cal. July 7, 2021).
148 Joint Statement re: Case Schedule and Trial Structure, 148 Joint Statement re: Case Schedule and Trial Structure, Google Play Store Antitrust Litigation, No. 3:21-md-02981-, No. 3:21-md-02981-
JD, January 14, 2022. JD, January 14, 2022.
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a ruling against Google and Apple that would enable people to download apps outside of the a ruling against Google and Apple that would enable people to download apps outside of the
companies’ stores would enable publishers to collect directly from subscribers/readers. The companies’ stores would enable publishers to collect directly from subscribers/readers. The
improved data could in turn enable publishers to charge advertisers higher rates for the ability to improved data could in turn enable publishers to charge advertisers higher rates for the ability to
more precisely target subscribers/readers in online advertisements.149 more precisely target subscribers/readers in online advertisements.149
Google: Alleged Monopolization of Search Engine
In October 2020, DOJ, along with 11 state attorneys general, filed a civil antitrust lawsuit against In October 2020, DOJ, along with 11 state attorneys general, filed a civil antitrust lawsuit against
Google in the U.S. District Court for the District of Columbia “to stop Google from unlawfully Google in the U.S. District Court for the District of Columbia “to stop Google from unlawfully
maintaining monopolies through anticompetitive and exclusionary practices in the search and maintaining monopolies through anticompetitive and exclusionary practices in the search and
search advertising markets and to remedy the competitive harms.”150 This lawsuit was supported search advertising markets and to remedy the competitive harms.”150 This lawsuit was supported
by the News Media Alliance, a trade organization representing newspaper publishers, which has by the News Media Alliance, a trade organization representing newspaper publishers, which has
charged that Google has increasingly used its search function to direct users to its own websites charged that Google has increasingly used its search function to direct users to its own websites
rather than those of publishers.151 rather than those of publishers.151
Potential Legislative Actions
Bills introduced in the 117th Congress to support newspaper publishers and journalists fall into Bills introduced in the 117th Congress to support newspaper publishers and journalists fall into
two main categories: some would amend antitrust laws in ways that might benefit newspaper two main categories: some would amend antitrust laws in ways that might benefit newspaper
publishers, while others would support newspaper publishers with grant funding and tax publishers, while others would support newspaper publishers with grant funding and tax
breaks.152 Selected examples are discussed below. breaks.152 Selected examples are discussed below.
Amending Antitrust Laws
The Journalism Competition and Preservation Act of 2021 (H.R. 1735; S. 673) would provide an The Journalism Competition and Preservation Act of 2021 (H.R. 1735; S. 673) would provide an
antitrust exemption for news content creators in negotiations with online content distributors for antitrust exemption for news content creators in negotiations with online content distributors for
four years.153 Sponsors of the bill stated that it is intended to support local newspapers and to four years.153 Sponsors of the bill stated that it is intended to support local newspapers and to
increase the diversity of news publishers.154 However, some Members have raised concern about increase the diversity of news publishers.154 However, some Members have raised concern about
the definition of “news content creators” and potential unintended effects of the bill.155 the definition of “news content creators” and potential unintended effects of the bill.155

149 Rob Williams, “App Store Law Would Give Publishers More Flexibility” (commentary), 149 Rob Williams, “App Store Law Would Give Publishers More Flexibility” (commentary), MediaPost, August 13, , August 13,
2021, at https://www.mediapost.com/publications/article/365939/app-store-law-would-give-publishers-more-2021, at https://www.mediapost.com/publications/article/365939/app-store-law-would-give-publishers-more-
flexibili.html?utm_source=newsletter&utm_medium=email&utm_content=headline&utm_campaign=123329&hashid=flexibili.html?utm_source=newsletter&utm_medium=email&utm_content=headline&utm_campaign=123329&hashid=
XNjiNboFTaeCo257joHIYw. XNjiNboFTaeCo257joHIYw.
150 U.S. Department of Justice, “Justice Department Sues Monopolist Google for Violating Antitrust Laws,” press 150 U.S. Department of Justice, “Justice Department Sues Monopolist Google for Violating Antitrust Laws,” press
release, October 20, 2020, at https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-release, October 20, 2020, at https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-
antitrust-laws. antitrust-laws.
151 News Media Alliance, 151 News Media Alliance, How Google Abuses Its Position as a Market Dominant Platform to Strong-Arm News
Publishers and Hurt Journalism, Arlington, VA, June 2020, p. 2, at http://www.newsmediaalliance.org/wp-content/, Arlington, VA, June 2020, p. 2, at http://www.newsmediaalliance.org/wp-content/
uploads/2020/06/Final-Alliance-White-Paper-June-18-2020.pdf. uploads/2020/06/Final-Alliance-White-Paper-June-18-2020.pdf.
152 Other bills have been introduced that would affect journalists, which this report does not discuss. For example, the 152 Other bills have been introduced that would affect journalists, which this report does not discuss. For example, the
Journalist Protection Act (S. 2528; H.R. 4857) would implement penalties for assaulting journalists, and the Press Act Journalist Protection Act (S. 2528; H.R. 4857) would implement penalties for assaulting journalists, and the Press Act
(S. 2457; H.R. 4330) would not allow a federal entity to compel a journalist or covered service provider to disclose (S. 2457; H.R. 4330) would not allow a federal entity to compel a journalist or covered service provider to disclose
protected information without a court-issued subpoena or other compulsory process. protected information without a court-issued subpoena or other compulsory process.
153 A similar bill (H.R. 2054) was previously introduced in the 116th Congress. 153 A similar bill (H.R. 2054) was previously introduced in the 116th Congress.
154 “Senator Klobuchar and Representative Cicilline Introduce Legislation to Protect Journalism in the United States,” 154 “Senator Klobuchar and Representative Cicilline Introduce Legislation to Protect Journalism in the United States,”
Senator Amy Klobuchar News Release, March 10, 2021, at https://www.klobuchar.senate.gov/public/index.cfm/2021/, March 10, 2021, at https://www.klobuchar.senate.gov/public/index.cfm/2021/
3/senator-klobuchar-and-representative-cicilline-introduce-legislation-to-protect-journalism-in-the-united-states. 3/senator-klobuchar-and-representative-cicilline-introduce-legislation-to-protect-journalism-in-the-united-states.
155 House Subcommittee on Antitrust, Commercial, and Administrative Law, “Reviving Competition, Part 2: Saving 155 House Subcommittee on Antitrust, Commercial, and Administrative Law, “Reviving Competition, Part 2: Saving
the Free and Diverse Press,” March 12, 2021, at https://docs.house.gov/Committee/Calendar/ByEvent.aspx?EventID=the Free and Diverse Press,” March 12, 2021, at https://docs.house.gov/Committee/Calendar/ByEvent.aspx?EventID=
111315. 111315.
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The effect of the bill on the newspaper industry would depend on how publishers would respond The effect of the bill on the newspaper industry would depend on how publishers would respond
to the antitrust exemption. For example, if large newspaper publishers group together to negotiate to the antitrust exemption. For example, if large newspaper publishers group together to negotiate
with online content distributors, concentration could increase among newspapers, furthering the with online content distributors, concentration could increase among newspapers, furthering the
decline of local newspapers. However, if large newspaper publishers join small ones to negotiate decline of local newspapers. However, if large newspaper publishers join small ones to negotiate
with online content distributors, smaller newspaper publishers may be able to improve their with online content distributors, smaller newspaper publishers may be able to improve their
bargaining power and obtain greater revenue from these online platforms. bargaining power and obtain greater revenue from these online platforms.
Other bills amending antitrust laws introduced in the 117th Congress may also affect newspapers. Other bills amending antitrust laws introduced in the 117th Congress may also affect newspapers.
For example, the Ending Platform Monopolies Act (H.R. 3825) would make it unlawful for a For example, the Ending Platform Monopolies Act (H.R. 3825) would make it unlawful for a
covered platform156 to own or control other lines of business that create the incentive and ability covered platform156 to own or control other lines of business that create the incentive and ability
for the covered platform to advantage its own business or exclude potential competitors. This bill for the covered platform to advantage its own business or exclude potential competitors. This bill
could affect some online platforms, such as news aggregators that publish original content, could affect some online platforms, such as news aggregators that publish original content,
depending on the criteria used to determine lines of business. The bill might also increase the depending on the criteria used to determine lines of business. The bill might also increase the
bargaining power of newspaper publishers, depending on the changes online platforms are bargaining power of newspaper publishers, depending on the changes online platforms are
required to implement.157 required to implement.157
Grants and Tax Breaks
Grant Funding
The 21st Century Federal Writers’ Project Act (H.R. 3054) would create a grant program The 21st Century Federal Writers’ Project Act (H.R. 3054) would create a grant program
administered by the U.S. Department of Labor for eligible entities to support individuals who are administered by the U.S. Department of Labor for eligible entities to support individuals who are
unemployed or underemployed in order to document in writing and images American society and unemployed or underemployed in order to document in writing and images American society and
the broad impacts and effects of the COVID-19 pandemic in the United States. Eligible entities the broad impacts and effects of the COVID-19 pandemic in the United States. Eligible entities
would include, among others, nonprofit and for-profit newsrooms. The bill would authorize would include, among others, nonprofit and for-profit newsrooms. The bill would authorize
appropriations of $60 million for FY2022 for the program. appropriations of $60 million for FY2022 for the program.
Tax Breaks for News Publishers, Advertisers, and Subscribers
The Local Journalism Sustainability Act (H.R. 3940; S. 2434) would allow individual and The Local Journalism Sustainability Act (H.R. 3940; S. 2434) would allow individual and
business taxpayers to receive tax credits for supporting local newspapers and media. Specifically, business taxpayers to receive tax credits for supporting local newspapers and media. Specifically,
individual taxpayers might claim an income tax credit of up to $250 for a local newspaper individual taxpayers might claim an income tax credit of up to $250 for a local newspaper
subscription. The bill also would allow local newspaper employers a payroll tax credit for wages subscription. The bill also would allow local newspaper employers a payroll tax credit for wages
paid to an employee for service as a local news journalist and certain small businesses a tax credit paid to an employee for service as a local news journalist and certain small businesses a tax credit
for local newspaper and media advertising expenses. Portions of this bill have been incorporated for local newspaper and media advertising expenses. Portions of this bill have been incorporated
into the Build Back Better Act (H.R. 5376).158 into the Build Back Better Act (H.R. 5376).158
Establishment of Local News Committee
The Future of Local News Act of 2021 (H.R. 3169; S. 1601) would create the Future of Local The Future of Local News Act of 2021 (H.R. 3169; S. 1601) would create the Future of Local
News Committee to examine the state of local news and make recommendations related to the News Committee to examine the state of local news and make recommendations related to the
ability of local news to meet information needs. The duties of the committee would include (1) ability of local news to meet information needs. The duties of the committee would include (1)
examining the implications of the loss of local newspapers, digital news outlets, and broadcasting examining the implications of the loss of local newspapers, digital news outlets, and broadcasting
outlets; (2) assessing the impact of the COVID-19 pandemic and whether the Paycheck outlets; (2) assessing the impact of the COVID-19 pandemic and whether the Paycheck

156 To be considered a covered platform, an online platform must meet certain criteria for the number of monthly active 156 To be considered a covered platform, an online platform must meet certain criteria for the number of monthly active
users and net annual sales or market capitalization. users and net annual sales or market capitalization.
157 For example, if this bill is implemented, it may become unlawful for a company to operate advertising services and 157 For example, if this bill is implemented, it may become unlawful for a company to operate advertising services and
an ad-based news aggregator service. an ad-based news aggregator service.
158 Most of Section 3 of H.R. 3940 was incorporated into Section 138517 of H.R. 5376 as passed by the House of 158 Most of Section 3 of H.R. 3940 was incorporated into Section 138517 of H.R. 5376 as passed by the House of
Representatives on November 19, 2021. Representatives on November 19, 2021.
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Protection Program has had beneficial effects on local news organizations; and (3) assessing and Protection Program has had beneficial effects on local news organizations; and (3) assessing and
examining existing and potential means of supporting local news production. The bill would examining existing and potential means of supporting local news production. The bill would
direct the committee to recommend mechanisms that the federal government could implement to direct the committee to recommend mechanisms that the federal government could implement to
support the production of local news, such as the possible creation of a national endowment for support the production of local news, such as the possible creation of a national endowment for
local journalism. The committee would comprise 13 members, including 8 appointed by local journalism. The committee would comprise 13 members, including 8 appointed by
congressional leadership. congressional leadership.

Author Information

Dana A. Scherer Dana A. Scherer
Clare Y. Cho Clare Y. Cho
Specialist in Telecommunications Policy Specialist in Telecommunications Policy
Analyst in Industrial Organization and Business Analyst in Industrial Organization and Business

Disclaimer
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