The findings of the Competition Commission have laid bare how search engine multinational Google’s dominance, which has seen it monopolise the local media industry, was impacting negatively on South African companies.
The findings come after the commission formally initiated the Media and Digital Platforms Market Inquiry on October 17 2023 due to existing market features in digital platforms that distribute news media content, the advertising technology markets that facilitate digital advertising and the artificial intelligence services that use and display news media content, which impede, distort or restrict competition, and which have material implications for the news media sector of South Africa.
“The inquiry found that major global platforms (Google, Meta, Microsoft, TikTok, X and AI companies such as OpenAI) dominate key gateways through which South Africans access information, namely search, social media, and AI-powered tools.
“In search, Google maintains a dominant position, where news represents 5-10% of queries and drives user engagement that is monetised through commercial advertising. Google does however not compensate South African media for the news content it displays or summarises,” read the report released this week.
No quarter given
“Google’s monopoly position and the unequal bargaining position of the media means there has not been an equitable share of value between Google and news publishers in South Africa both historically and currently.
“This inequity has materially contributed to the erosion of the media in SA and will continue to do so unless remedied. The inquiry has used a variety of measures to determine the additional value extracted by Google search annually from publishers, or value destroyed through conduct that promotes zero-clicks, resulting in a range of estimates from R200-million to R300-million for 2023.
“This has served as a guide to the inquiry negotiations with Google over remedies.
The Competition Commission stopped short of accusing Google and Microsoft of using its platforms to drive western imperialism.
SA media undercut by global giants
Google’s algorithms, explained the commission, distort competition between news media organisations insofar as it over-represents global news media in SA for search and top stories, and under-represents vernacular and community media.
“These issues are exacerbated by SEO requirements for the algorithm and for core updates to the algorithm where there is insufficient transparency on how the media will be affected and how to avoid traffic loss. Microsoft similarly under-represents SA media on Start due to the limited number of SA media companies that it contracts. It also under-represents SA media on Bing,” it said.
When offering remedies, the commission ordered Google to fund the SA news media, by starting a Digital News Transformation Fund for small independent and community media at R38-million per year for three years from November 2024, with matching funding of R19-million per year for a further two years.
“The purpose is to support small independent and community media to digitally transform their newsroom and audience engagement to become more sustainable in the digital era,” said the commission.
For the mainstream media, including the SABC, the multinational has been ordered to launch the Google News Showcase (GNS), or a successor programme, within three months for mainstream national media and broadcasters, including the SABC, valued at R71-million per year for five years, totalling R355-million over the stated period.
“The purpose of the GNS is to compensate the media for content provided through the news showcase.”
Google will also be required to start an AI Innovation Fund within six months for mainstream media valued at R45-million per year for three years.
“The purpose is to support AI innovation projects to reduce costs and build audience engagement through AI news products,” said the commission.
Remedies suggested
In addition, Google will support training and product change initiatives that can grow the digital presence of the SA news media on search by, among others:
- Launching preferred sources functionality in SA within 12 months and invest R8.7-million in a marketing campaign to encourage SA users to adopt SA news media as preferred sources on Google Search;
- Provide a Core Web Vitals programme within six months offering individual support to 15 publishers per year for three years to audit, recommend optimisations and assist in implementing changes to their website performance that will improve search ranking;
- Google News Initiative vernacular language training within three months in partnership with the MDDA valued at R11.6-million over three years to make GNI training on developing audiences, strengthening digital journalism and growing revenue accessible to vernacular language publishers and broadcasters;
- Support AI adoption in the news media through AI training to small independent and community media within six months and for a three-year period, including training on content opt-out controls for Google products.
Microsoft has been ordered to support news media monetisation on its platform within six months through offering national news media and broadcasters the option to contract with MSN and onboarding five national media and broadcasters that express interest.
