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09 November 2017

NMA: Tech Platforms Should Make 'Equitable Contribution' to Advertising Self Regulation

The tech platforms should make "equitable contribution" to the system of voluntary self-regulation of advertising to fully reflect the scale of regulatory activity they have driven in this area, the News Media Association has said.

In a submission to the House of Lords Communications Select Committee inquiry into the advertising industry, the NMA said it strongly supported the work of the Advertising Standards Authority and CAP and the Government should encourage the digital sector should make a greater contribution to the system. 

The NMA said: "Digital advertising represents a rapidly growing caseload for the ASA, which recently stated that 'nearly half of our work now involves regulating online ‘advertiser-owned’ ads, material that just five years ago wasn’t covered by the rules.'

"According to its 2016 annual report, internet advertising generated 10,431 complaints for the ASA, up nine per cent on the year before. Ads in the national press, in contrast, were the subject of 672 complaints, down 29 per cent on 2015, while complaints about ads in the regional press fell 29 per cent to 342.

"The system of advertising self-regulation upheld by the ASA is financed by the industry itself. As the ASA is focussing increasingly upon digital advertising, that sector should provide a proportionate and equitable contribution to its funding. We hope that the Committee and government will encourage it to do so."

In the submission, the NMA said that the value chain of the digital news environment was unfairly skewed in favour of those who aggregate and distribute content at zero cost, to the detriment of publishers who produce it at considerable financial and legal risk. 

“The great beneficiaries from this decoupling are the tech platforms who are believed to be capturing the lion’s share of the spoils from digital advertising. Figures compiled by analysts and trade bodies consistently point towards Google and Facebook commanding around 60 per cent of the digital ad spend and nearly 100 per cent of growth in this area.”

This, the NMA added, was despite the fact that nearly half of material shared and linked to on social media in the UK comes from newsbrand websites, according to data from NewsWhip.

“The disparity in rewards reflects the market dominance of Google and Facebook – sometimes referred to as the “duopoly” - in their respective domains of search and social and their resulting ability to dictate the terms of interaction with publishers. It does not reflect the amount of value that journalism creates for these platforms.”

The NMA called on Ministers and regulators to be “engaged and vigilant” with the regard to the effect of Google and Facebook on the competitiveness on the UK media landscape.

In its submission, the NMA said it was important that the role of local media as an advertising medium was recognised as part of moves to set up creative clusters across the UK, recently proposed in Sir Peter Bazalgette’s review of the creative industries.  

“It is essential that any tax-payer-backed initiatives to promote advertising to SMEs and start-ups fully involves forms of advertising that are trusted by the public and that have demonstrable track records in delivering return on investment. Local newspapers have consistently been found to be the most trusted and most popular source of local news by some distance,” the NMA added.

The NMA also called for the UK to ensure that, post-Brexit, its legal regime for data protection, e-privacy, audio-visual media and other areas that impact on the media continue to include strong exemptions, derogations and protections for press freedom and freedom of expression.