RAPULA MOATSHE
Besides a proposed landmark compensation from tech giant Google to the local media, totaling R300 million to R500 million annually over a three to five year period, South Africa’s Competition Commission also took aim at other social media platforms such as Meta (Facebook), Microsoft, OpenAI, X and TikTok.
In its provisional report released on Monday regarding the media and digital platforms market inquiry, the Commission proposed that Meta should cease deprioritising news content in users' feeds, with the goal of restoring referral traffic to local media outlets to at least double its previous peak.
The inquiry was conducted against the backdrop of a media sector that has been under severe financial strain following the digitisation of news consumption.
The report into a 16-month period inquiry was released on Monday for public comment and stakeholder feedback.
Meta and X, according to the report, should stop deprioritising news posts with links in user feeds, ensuring that local news sources receive fair visibility.
The Commission held the view that YouTube's revenue sharing model should support local media and broadcasters, including the SABC.
The report proposed that YouTube increase its revenue share to 70% and actively promote higher-value direct sales by the media.
According to the report, a significant shift in news consumption habits has occurred, with 87% of the population now accessing news online, primarily through mobile devices. Notably, most online news videos are watched on digital platforms rather than on news websites themselves.
The report noted that social media and search engines have become primary news sources.
Media expert Paula Frey, also a commission panel member, noted that traditional advertising revenue for print media has plummeted by 40% and the SABC has experienced a staggering 47% decline in revenue from its peak.
She highlighted the alarming consequences of declining revenue and the impact of AI on journalism, including a drastic reduction in jobs for journalists, with numbers being halved, increased casualisation of journalists, and the closure of numerous community and regional newspapers.
The inquiry's findings also underscored the threat posed by declining advertising revenue to media diversity and plurality, as power becomes increasingly concentrated among a few large media conglomerates.
Frey warned that AI-powered chatbots introduce a new challenge for news media, as they can divert referral traffic and capture value within their own platforms.
Furthermore, she said, digital platforms impose additional costs on news media outlets by requiring customised content formats, continuous algorithm optimisation, and misinformation management, thereby exacerbating the financial strain on local news sources.
She said the evidence presented to the inquiry unequivocally shows that most South African consumers rely on social media as their primary source of news.
Platforms such as YouTube, Meta, X, and TikTok play a significant role in driving news consumption, she said.
However, Meta and X have been found to deprioritise posts containing links, resulting in reduced referral traffic to news websites.
The inquiry noted that news outlets struggle to generate revenue from their content on YouTube, while social media algorithms often inadvertently spread misinformation.
Another concern was the use of South African media content to train AI models, a practice that, although limited until now, is expected to become increasingly significant.