European Publishers: Scale Of Tech Platforms Profits Is Abnormal
Recent profit announcements by tech platforms demonstrate how rapidly they are using their monopoly positions to extract revenues from markets in which they operate and generate “abnormal” levels of profit, European publishers have said.
News Media Europe, of which the News Media Association is a member, and other EU media associations have issued a joint statement encouraging the swift adoption of the Digital Markets Act with targeted improvements and a clear focus on gatekeepers.
“A combination of lax regulation, harmful and unfair practices by Gatekeepers, and ineffective European competition remedies, means that a handful of global players have used their monopoly positions to become the Gatekeepers to the digital economy,” European publishers said.
“Gatekeepers drive the vertical integration within the wider media ecosystem, using platform policies to squeeze independent media businesses and locking out new entrants, extracting revenues from the creative ecosystem through monopoly rents, that would otherwise be reinvested in production and media plurality.”
The publishers welcomed the European Commission’s proposal to adopt an internal market instrument, with its “much-needed” ex-ante regulatory approach which address the “harmful practices of gatekeepers” through the imposition of mandatory obligations and prohibitions.
The publishers said the proposal is a “clearly targeted and sound document” which acknowledges the need to control the conduct of digital gatekeepers in order for digital markets to remain fair and contestable.
“This is why the media sector strongly believes that it is imperative that the Proposal is not watered down as it goes through the European Parliament and the Council,” the publishers added.
The publishers welcomed the proposal and listed a series of detailed amendments to ensure that the DMA will be a comprehensive instrument that captures and effectively addresses harmful – existing and potential future – conducts of gatekeepers.
The publishers added: “Recent profit announcements by the biggest gatekeeper platforms demonstrate how rapidly they are using their monopoly positions to extract revenues from markets in which they operate.
“The scale of these profits is abnormal, prompting an urgent need for the harmful market practices identified to be banned before any remaining competition to these platforms is eliminated.”
Separately today, the FT reported that the European Commission is set to open a formal probe into Facebook’s alleged anti-competitive practices as it seeks to understand whether the company is undermining rivals in classified advertising.