Digital Updates – October

DIGITAL UPDATES

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OCTOBER UPDATES

Facebook to Launch News Tab on Friday, October 25

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On October 23, Facebook Chairman and CEO Mark Zuckerberg stated during a congressional hearing that the company would be launching its News Tab later in the week. The company spokesperson later confirmed that the new initiative to support high-quality journalism would be launched at a news conference in New York City on Friday, October 25. Facebook has reportedly been negotiating licenses with news publishers to license content for the News Tab, which will be curated in part by veteran journalists. Mr. Zuckerberg’s announcement came during the House Financial Services Committee hearing titled “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors.” Mr. Zuckerberg was the sole witness at the hearing and was answering a question from Representative Frank Lucas (R-OK) about Facebook’s media literacy initiatives and other efforts to promote trusted information on the platform. Read more about Friday’s planned announcement here and watch the hearing here.

The Alliance Commends the Passage of the CASE Act in the House

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The News Media Alliance commends the House of Representatives for passing H.R. 2426, the “Copyright Alternative in Small-Claims Enforcement Act of 2019” (CASE Act) on October 22. The House adopted the bill by an overwhelming vote of 410-6. The CASE Act would address the problem of prohibitive costs of federal copyright litigation by creating a small claims court within the U.S. Copyright Office that would help small publishers and other creators by providing an alternative, low-cost venue for protecting their intellectual property. In a statement, the Alliance President & CEO David Chavern noted the importance of making it easier for small publishers and creators to protect their works and called on the Senate to also pass the CASE Act. Read the Alliance statement here.

Congress Continues Its Hearings on Dominant Online Platforms

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On Oct. 18, the House Subcommittee on Antitrust, Commercial and Administrative Law held its third hearing on dominant online platforms titled, “Online Platforms and Market Power, Part 3: The Role of Data and Privacy in Competition.” The witnesses included FTC Commissioner Rohit Chopra, Dr. Tommaso Valletti (Imperial College London), Dr. Jason Furman (Harvard University), and Dr. Roslyn Layton (American Enterprise Institute). Commissioner Chopra indicated support for more meaningful antitrust enforcement and penalties, while Professor Furman noted the need to address the under-enforcement of digital mergers. Most of the witnesses expressed support for some form of government action when it comes to competition rules and online privacy, noting the positive effect an enhanced competition regime may have on consumer privacy. Commissioner Chopra also expressed concerns over behavioral advertising, referring to the financial motivations of the platforms that undermine their immunity under Section 230 of the Communications Decency Act. Watch the hearing here.

Congress Holds a Hearing on Section 230 of the Communications Decency Act

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On October 16, the House Subcommittee on Communications and Technology and the Subcommittee on Consumer Protection and Commerce held a hearing titled “Fostering a Healthier Internet to Protect Consumers.” The hearing focused on Section 230 of the Communications Decency Act and whether Congress should amend the Act in light of the numerous online harms that the platforms have failed to address. As it stands, Section 230 provides broad liability protections to online platforms for third-party content, immunizing the platforms from most civil liability. Congress is currently considering multiple issues that may require changes to the online liability provisions, including online hate speech, election interference, and the sale of illegal opioids and other illicit goods online. The witnesses at the hearing included both online industry representatives as well as critics calling for changes in the law. Multiple representatives questioned the online platforms’ ability to effectively self-regulate and noted that the Congress may be forced to take action if the platforms fail to act against online harms. Others, including Rep. Jan Schakowsky (D-IL) – who is on the House Democrats’ Trade Working Group – also questioned the inclusion of Section 230 immunities in international trade agreements, including the recently negotiated United States-Mexico-Canada Agreement (USMCA). Read the prepared witness statements and watch the hearing here.

In Lieu of Newspapers, Starbucks Begins Offering Free Digital News Access

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Starbucks announced on October 1 that, in lieu of selling print newspapers in their stores, they will instead offer free digital access to several news sources for a limited time. The News Media Alliance worked with the company to help facilitate partnerships with the participating media outlets. Starting this month, Starbucks customers using in-store wireless internet service will have free access to the websites of the Chicago Tribune, The Wall Street Journal, the New York Daily News, The Baltimore Sun, USA Today, The Seattle Times and the Orlando Sentinel. All of the websites typically have metered paywalls that block access after users read a certain number of articles and prompt readers to subscribe. However, readers accessing the sites through Starbucks’ in-store Wi-Fi will not hit the paywall and will have unfettered access to the participating news publications. Starbucks may later do another rollout with more news publishers.

Facebook Settles a Lawsuit by Advertisers Alleging Inflated Video Viewing Data

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On October 4, Facebook and a group of advertisers who purchased video ads on Facebook’s platforms filed a proposed class action settlement resolving a case that has been in litigation since 2016. The case concerns Facebook’s alleged overstating of average viewing times for video ads on the platform, causing advertisers to overpay for their ads. According to the lawsuit, Facebook discarded video views that lasted less than three seconds, thereby overstating the average video watch times by as much as 900 percent. The proposed settlement requires Facebook to pay $40 million, and allows all U.S. advertisers who bought video ads between February 12, 2015, and September 23, 2016, to participate in the settlement. Facebook’s reported practices are concerning to news publishers as they are entering into relationships with Facebook to license content for its News Tab, expected to be launched soon. Read more here.

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