Google threatens to cut off news after California proposes paying media outlets

Having never read this, current Texas anti-trust lawsuit. [1]

Alleges quite a bit, yet the main four in the article are.

1) Google says it runs a Second Price auction, but really runs a Third Price auction, ignores the 2nd bid, and takes the difference for (shifting purposes). Telling a Publisher they made $8, when they would have made $12.80.

2) Google inflates bids of buyers "to ensure their advertisers beat out bids from competing buying platforms". Artificially making their platform look better economically. Was individual cases, yet now alleged to be a global pool of stolen Publisher money.

3) Gaining access to Publisher's ad-spend behavior with Dynamic Allocation, and then using the info to make sure rival platforms seemed less competitive by manipulating and inflating other bids. Make sure they always seem to lose by $0.01 on every bid.

4) Forcing Publishers to accept Dynamic Allocation by punishing them with the maximum allowed revenue drop for Bernake (40%) while inflating competitors. Notably Machiavellian that there was a known allowed revenue drop. "We're bein nice, we'll only cut you 25%"

On a slightly different topic, made me wonder how many investment firms artificially lower rates on funds to scrape a bit of profit off the top.

[1] https://texasattorneygeneral.gov/sites/default/files/images/... (note, the child-support location is really weird)

Completely agree with all this, though my take away is that there's a big vicious cycle of adblockers and paywalls where they keep getting worse. I can't afford to subscribe to every newspaper I read. All the local (and smaller national) papers should unionize and make one subscription for something like $20 a month

The value proposition in the internet age is too low to demand the price neccessary to support it. This created a race to the bottom in order to keep the lights on. This further degraded the value of the product. This caused people to value it less, and so on.

The end result is reputable news sites became clickbait and eventually people stopped caring.

There is still a market for in depth journalism, and we see a rise in that sort of things. There are plenty of youtube channels doing documentary-like videos on current events. That is journalism.

The journalism that is dying is the stuff concentrating on breaking news. If its shallow its outcompeted by twitter. If its higher quality but still racing to the headline, its outcompeted by wikipedia. The fact is the competitors to breaking news journalism are cheaper and higher quality.

For the record, I disagree with the bill.

My point is that sharing links is a double edged sword that was sort of forced on the news publishers. They've grown dependent on the traffic -- and agreed, they need a different business model -- but thats tough when anyone else can undercut you and publish for free, and then compete for that same traffic.

Also, if you think you can differentiate on curation or speed, you cannot, because those same links will appear regardless.

And yes, the advertising monopoly is a huge part of this -- but the argument has always been that the search engines need news just as much as news needs search engines. But they've set up the situation in a way that they have all the leverage.

I have sympathy for news publishers but I worry a lot about the principle of asserting that linking to something is an act that the link target has proprietary rights to over. At some level, it is almost a free speech issue. If I can't refer to what you are saying, without owing you something, you have power over not just my speech, but a power to limit how your work is subjected to criticism and debate. It's effectively an extension of copyright law to expand copyright holder's rights.

Obviously all this is hyperbolic based the actual text of the law. The law doesn't directly apply any sort of link tax, and it is shamelessly targeted only at Google and Facebook (to the point that they wrote Facebook in there by name, which is kind of stupid if you ask me). But if you drill into the reasoning it hits at the foundational level on this basic logic, and it's pretty concerning if we assume then that this will be significantly extrapolated and expanded - as has been the history with all other aspects of copyright in the past.

Honestly I would rather that governments come clean and just admit that the problem they are trying to solve is actually a "social good" outcome, and therefore directly tax the platforms and then redistribute the revenue to a fund created by government for news journalism themselves. Trying to artificially construct that through introduction of significant new precedents in copyright law engenders huge risks of unintended consequences and potential future extrapolation and abuse of this principle.