Newspapers are classic examples of platforms. They are intermediaries between, and typically require participation from, two distinct groups: on the one hand, there are patrons eager to read the latest scoop; on the other hand, there are advertisers offering their goods and services on the outer edges of the paper in hopes of soliciting sales. More than mere examples of platform economics, however, newspapers and the media industry play an irreplaceable role in the functioning of our democracy by keeping us informed. From behemoths such as the Jeff Bezos–owned Washington Post to outlets like the Hungry Horse News in the small town of Columbia Falls, Montana, the press lets us know what is happening on both the national and local levels. However, the age of the Internet and the corresponding emergence of new two-sided platforms is decimating the media industry. In a world where more users get their news on social media platforms like Facebook than in print, the survival of quality journalism depends in large part on whether the media industry can tap into the flow of digital advertising revenue, the majority of which goes to just two corporations founded around the start of the new millennium.
Facebook and Google, formed respectively in 2004 and 1998, are new types of platforms aiming to accomplish what newspapers have done for centuries: attract a large consumer base and solicit revenue from advertisers. However, unlike the fungible papers newsies once distributed hot off the presses, Facebook and Google connect advertisers and consumers in a more sophisticated, yet opaque manner. Facebook and Google are free to consumers insofar as users do not pay with money to surf the web or connect virtually with their friends. Instead, the companies collect information about users based on their online activity, and complex algorithms connect those users with targeted advertisements. This new method of connecting Internet users and advertisers has been wildly successful, creating a tech duopoly profiting from nearly sixty percent of all digital advertising spending in the United States.
. Throughout this Note, I refer to the journalism industry also as the “media” industry and the “news media” industry. Although there are undoubtedly nuanced differences between journalism and news media, for the purposes of this Note, I draw no distinction between them.
. Elisa Shearer, Social Media Outpaces Print Newspapers in the U.S. as a News Source, Pew Rsch. Ctr. (Dec. 10, 2018), https://www.pewresearch.org/fact-tank/2018/12/10/social-media-outpaces-print-newspapers-in-the-u-s-as-a-news-source [https://perma.cc/5MWY-RSTH].
. Although I may not be interested in an upcoming Black Friday deal for chainsaws posted in a physical publication of the Hungry Horse News, Facebook and Google are—based on my history and activity on the platforms—aware of my affinity for things like antitrust law and coffee, and so their algorithms are likely to present advertisements to me for items such as books written by Herbert Hovenkamp and expensive burr coffee grinders.
. Felix Richter, Amazon Challenges Ad Duopoly, Statista (Feb. 21, 2019), https://
* Executive Senior Editor, Southern California Law Review, Volume 95; J.D. Candidate, 2022 University of Southern California, Gould School of Law. I would like to thank Professor Erik Hovenkamp for serving as my advisor. All mistakes are my own.