News Media Organizations Fight for Fair News Market with Google and Facebook

News organizations throughout the US are worried about the influence of tech companies, Facebook and Google as news seeking sources. According to a report published by The Verge Magazine on July 10, 2017 about a half of US adults use Facebook as their primary news delivery mechanism while Goggle controls over two thirds of all online advertising market. Newspaper publishers standing under the banner, News Media Alliance (NMA) are planning a push back by supporting an antitrust exemption through Congress. Like the unions, the exemption will allow news organizations, to bargain with Google and Facebook.

If the push comes to fruition, news media organizations will wield some leverage against strong web platforms and control the flow of viral hoaxes and fake news as evident in Goggle searches and Facebook Newsfeed. The move will also enable media organizations expand innovative digital models of news distribution and create strategies to sustain journalistic professionalism. According to David Chavern, the president of News Media Alliance, platforms like Facebook and Google are easily overstepping antitrust regulations and making aggressive acquisitions of big competitors. Facebook recently bought out erstwhile competitors Instagram and Whatsapp.

Chavern adds that the critical role of news media in the in US politics and history means a fair fight with online information gateways is essential. It is widely feared that a move to institute bargaining rights may not succeed because the Republican controlled Congress might not be receptive to the idea. However, the greatest hope in the way of legislation may come from news publishers like the Chairman and Founder of News Corporation, Rupert Murdoch who has good relations with the Trump administration. According to Forbes Magazine, Murdoch owns a number of big media concerns, including The Wall Street Journal, Sunday Times and Fox News. His net worth is estimated at $12.3 billion.

Advertising and Online Marketing Companies Impacted by Trump Presidency

Some advertising companies have dropped in stock price upon the election results nominating Donald Trump as President of the United States. These two companies have experienced a decrease in their stock price of roughly two percent since the election results.

 

Two major international players in the advertising industry, WPP and Publicis have seen major drops in their stock post election. The logic behind this is that these companies will experience lower income in United States as a result of a downward pressure on the US economy after the election results.

 

Trump is expected to push for policies that will lead to potential international trade wars with China and Mexico, and may seek to eliminate the NAFTA trade agreement as well as plans for a similar Transpacific partnership. On the campaign trail Trump was particularly critical of these trade deals as eroding American economic strength and eliminating manufacturing jobs in the United States. If this happens, many companies are thought to lower the amount that they spend on their advertising budgets.

 

In addition, Trump’s policies are thought likely to contribute to a weaker American dollar. The US dollar has been particularly strong recently as other countries have experienced and even pushed for their currency eroding. Advertising agencies like WPP and Publicis are likely to experience lower revenue when translated into their base currencies. WPP is located in the UK and increased its stock value after Brexit dropped the British pound. Publicis is a French company.

 

WPP earns about 35% of their revenue in the US while Publicis earns half of their money in the American market. Both of these companies own entities that provide for significant amounts of both traditional advertising as well as online marketing and advertising services through their subsidiaries Mindshare and Razorfish. These entities compete against two major American advertising entities Omnicom and Interpublic.

 

Whether these stock moves downward are prescient or exaggerated will be the focus of policies that have yet to be put in place. Many market observers believe that Trump was stating policies that he is unlikely to put in place thereby leading to exaggerated stock moves for and against certain stocks that may be different for future results thereby leading to an opportunity in these major advertising and online marketing stocks.