A bundled stack of Chicago Tribune newspapers sitting at one end of a rolling conveyor
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Local news gets a second chance to unite against Big Tech

Protocol Policy

Hello, and welcome to Protocol Policy! Today we look at how a last-minute deal on an amendment managed to save the Journalism Competition and Preservation Act — and possibly create a headache for Big Tech. Also, the SEC decided not to ban payment for order flow and Russia’s SWIFT alternative has been gaining steam.

Saved by the amendment

The Journalism Competition and Preservation Act is back from the dead. The bipartisan bill would allow small media outlets to band together to negotiate pay rates from Big Tech platforms such as Facebook and YouTube. This corporate collective bargaining would normally be illegal under antitrust law, but the JCPA carves out a four-year exemption period.

I have to admit, I was among the crowd that thought the JCPA hardly stood a chance of making it to the floor. My reasons, I think, were justified:

  • When the Senate Judiciary Committee considered the bill two weeks ago, just about anything that could have gone wrong did. Sen. Ted Cruz proposed an amendment that banned content moderation considerations from entering revenue split negotiations. The amendment passed by a one-vote margin, but it torpedoed the bipartisan consensus.
  • Cruz took a hardline stance, claiming he’d only vote for the bill if it included his amendment. He also repeatedly said he couldn’t see a path for the bill to pass on the floor, even if it passed in committee.
  • Sen. Amy Klobuchar was understandably frustrated by the introduction of the amendment. “The agreement we had was blown up,” she said in the meeting, before asking to delay the committee vote.

Klobuchar saved the bill by adding Cruz’s desired content moderation protections. A new amendment, replacing the one Cruz introduced two weeks ago, stipulates that price agreement negotiations cannot address “whether or how the covered platform or any such eligible digital journalism provider displays, ranks, distributes, suppresses, promotes, throttles, labels, filters, or curates the content.”

  • Klobuchar struck an optimistic note on the outcome, reiterating that she and Cruz “actually share the view that this is not about content — that this is simply about negotiating prices.”
  • The bill eventually passed through committee with a 15-7 vote. All the holdouts came from the Republican side.
  • Republican Sen. Mike Lee, who voted against the JCPA, said the JCPA would make “publishers more dependent on big tech, not less,” since they’d be sharing in the “monopoly rents” of Big Tech.

Big Tech is worried — and not just about money, they say. If the JCPA works as intended, it would mean Big Tech will split a greater share of ad revenue with smaller media outlets (the bill applies to newsrooms with fewer than 1,500 employees). One need not look further than that for a reason they’d be against it.

  • But some Big Tech lobbying groups claim the JCPA will benefit right-wing outlets peddling disinformation.
  • Sen. Klobuchar denies that characterization, saying the bill doesn't require platforms to carry any content they weren’t already accessing.
  • But Sen. Alex Padilla, also a Democrat, seemed to think it was a valid concern. In the Thursday committee meeting, he asked whether the bill “creates an opportunity for outlets like Project Veritas or InfoWars to simply upload their videos to YouTube, and then compel payment from the company from the platform.” (Infowars is already banned from YouTube, so Padilla might want to rethink that specific example.)

Implementation of the JCPA could still be tricky, to put it mildly. There have already been issues around what counts as a small newsroom.

  • Lee pointed out, for instance, that the 1,500-employee limit doesn’t account for smaller outlets that are owned by big conglomerates.
  • There are several other difficult-to-define thresholds in the bill, including a stipulation that 25% of a covered publication’s output be “current news and related content.”
  • Then there’s the question of alliance formation: Would Jacobin, for example, join forces with Project Veritas to bargain for higher pay? I have my doubts. So would the media coalitions form along partisan lines? And if so, what happens if the pay rates between ideologies vary drastically?

And the floor vote isn’t guaranteed. Some of the Senate Democrats who voted for the JCPA in committee still voiced concerns with it. Sen. Padilla, for instance, called for stronger language to make sure revenue goes to journalists, pointing to the example of Alden Global Capital buying up the Chicago Tribune and proceeding to fire journalists and issue stock buybacks. Those types of concerns from Democrats signal that the JCPA could still face a tough road ahead. The content moderation amendment could win over some Republicans, but they might be better off turning to the courts to tackle their social media qualms.

— Hirsh Chitkara (email | twitter)

In Washington

The Securities and Exchange Commission decided not to ban payment for order flow. That’s great news for Robinhood, which used the practice to monetize all those commission-free trades from users. Just a year ago, SEC Chair Gary Gensler said a total ban was “on the table.”

Tesla issued a recall of 1.1 million vehicles due to a window issue identified by the National Highway Traffic Safety Administration. NHTSA said the Tesla vehicles don’t comply with federal safety requirements and the automatic window-closing system could injure drivers.

Military innovation agency DARPA, known for helping develop such tech as “the internet,” is taking a look at crypto. The Washington Post reports that DARPA will assess cryptocurrencies for potential threats to national security and law enforcement.

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In the states

Florida’s attorney general asked the Supreme Court to consider a case about the state’s social media law. The law, which prohibits social media companies from deplatforming politicians, was partially struck down by a federal court in May. A different federal appeals court recently upheld a similar Texas law, creating the kind of circuit split that often goes to SCOTUS for resolution.

San Francisco’s Board of Supervisors approved a plan to give police real-time access to private surveillance networks. The decision was opposed by groups such as the ACLU of Northern California and the Electronic Frontier Foundation.

Parents have filed more than 70 lawsuits against Big Tech this year, alleging product harm, according to a Bloomberg report. The lawsuits claim Big Tech products — and social media, in particular — harm children and cause anxiety, depression, and eating disorders.

On Protocol

The FDA’s very belated warning on the “NyQuil cooking challenge” shows how government leaders need to reassess how they deal with viral content, Protocol’s Sarah Roach explains. The TikTok video instructed viewers on a very special recipe of cooking chicken in a sauce of … NyQuil.

COVID protocols are fading at tech companies. Tools like contract tracing and symptom trackers are being used less often, even as some offices experience outbreaks. Many workers still aren’t coming into office, but COVID isn’t the driving factor for that.

Around the world

The EU is considering a ban on facial recognition. The prohibition would apply to the use of any real-time facial recognition being used in a public setting to indiscriminately scan individuals. Government officials in France reportedly worry that the ban would weaken their ability to identify terrorist suspects.

Russia’s SWIFT alternative has been gaining momentum. A Russian official claims that 50 entities have joined their System for Transfer of Financial Messages network this year, bringing the total number of participants to 440. The Western SWIFT sanctions were intended to cripple Russia’s economy, but that proved not to be the case.

In data

10%: That’s how much Meta plans to cut expenses “in the coming months,” The Wall Street Journal reports. That plan reportedly includes an overall reduction in head count, as well as cuts to overhead and consulting budgets.

You better come in … if you feel like it

Many companies are pushing return-to-office plans, but it turns out those policies often go unenforced. Over 40% of HR leaders said they weren’t tracking office attendance, according to a Gartner study conducted last month. Protocol spoke to two Google workers who said even though the company “requires” they be in office three days a week, the policy isn’t really enforced.

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Thanks for reading — see you Monday!

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