In South Africa, Google faces an annual fine of R500 million for the imbalance in digital advertising
Google is fined up to R500 million a year in South Africa to make up for the disparity in earnings from digital advertising to local media.
Google has been fined between R300 million and R500 million annually as a “provisional remedy” for five years by the South African Competition Commission, which is currently looking into the Google, X, and Meta platforms. This is to make up for the imbalance in competition and digital advertising revenue for local news media, including radio, television, and online.
This is among the key conclusions of the commission’s eagerly awaited preliminary report, which is the result of its 16-month market investigation of media and digital platforms.
The commission has threatened to impose a 5–10% fee on the digital giants in order to compensate the local media business if the corporations it has identified in its findings do not cooperate with the suggested fixes, even as it continues to look into other platforms.
In order “to restore referral traffic to the media from its peak with at least a 100 per cent increase in referral traffic,” the commission stated that it wanted Meta to cease deprioritizing news on Facebook.
According to the commission, Elon Musk’s X and Meta must also “stop de-prioritizing news with links in the user feed.” These demands set the stage for a major battle with the multinational internet companies, who have resisted similar recommendations in other jurisdictions.
In order to train AI chatbots, it emphasized that the media should be able to bargain jointly with AI businesses for content partnerships.
In order to address what it has characterized as the “imbalance in shared value while putting in place changes to search that will sustainably create shared value with the media through increases in referral traffic,” the commission has suggested that Google pay up to R500 million annually.
The committee said in a statement that “this includes the promotion of vernacular and community media and the removal of search bias in favor of foreign media and YouTube.”
According to the investigation, Google makes between R800 million and R900 million a year from news material, while South African media lose between R300 million and R500 million.
The investigation, which began in October 2023, entailed 16 months of intensive evidence collection, public and in-camera hearings, expert report submissions, engagement with industry key actors, and focus group talks, according to Competition Commissioner Doris Tshepe.
It was started in accordance with the Competition Act because the commission has good grounds to think that some market characteristics on digital platforms that disseminate news media material hinder, stifle, or distort competition or compromise the Act’s goals.
The investigation is particularly distinct because the media play a crucial role in ensuring that the freedom of expression guaranteed by the constitution is fulfilled, and their efforts also support the realization of many other fundamental rights. Any excessive injury to the news industry would jeopardize the fulfillment of these constitutional rights because digital platforms do not produce their own material, Tshepe stated.
Furthermore, in the draft report, the competition regulator, which has expanded its investigation to include the entire technology sector, suggested that YouTube enhance the capacity of broadcasters and the media, including the SABC, to monetize their content on the platform by raising the revenue share to 70% and encouraging the media to actively promote higher value direct sales.
It also suggested amending the Electronic Communications and Transactions Act to include platform liability for harmful content and misinformation amplification in order to combat misinformation. The panel has suggested that social media companies collaborate with the media and pay them for fact-checking.
