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Media Body Urges IT Giants to Negotiate with News Outlets; Yahoo Japan Draws Particular Scrutiny as Largest News Buyer

Yomiuri Shimbun file photo
The Fair Trade Commission / The Public Prosecutors Office. in Chiyoda-ku, Tokyo, Japan, February 6, 2022.

The Japan Newspaper Publishers & Editors Association has issued a statement calling on major information technology companies to start sincere negotiations with media organizations in the country over issues such as license fees paid for news articles.

Search engines and online news portals, such as Yahoo News, now have a significant impact on the distribution of news articles.

The newspaper association, also known as Nihon Shinbun Kyokai, released the statement on Thursday in response to a report issued by the Japan Fair Trade Commission (JFTC) last month.

The JFTC said in the report that Yahoo Japan Corp. may be in a superior bargaining position against news organizations as the firm is the largest purchaser of news articles. The report pointed out that the firm may run the risk of violating the Antimonopoly Law if it pays media outlets remarkably low fees for their articles.

Yahoo Japan Corp. became part of the newly formed LY Corp. in a merger this month.

The Japan Newspaper Publishers & Editors Association said that platform operators should disclose to media organizations the total amount of advertising revenue they earned through purchased news articles, and explain the criteria for calculating license fees paid to news media organizations for using their articles.

It also noted the need to sufficiently consider how much traffic was driven by articles in calculating the license fees.

Google and other search engines display headlines and abstracts of news articles on search result pages. The JFTC survey revealed that many viewers simply look at the headlines and abstracts, and do not visit the websites of the media organizations that publish the full articles.

There are growing moves overseas to have search engine operators pay license fees for the use of news articles on search result pages.

In light of that, the association urged search engine operators to agree to start negotiations over license fees with media organizations in Japan.

On the other hand, the association also pointed to the limits of the current legal system for realizing fairer business dealings between major information technology companies and media organizations over the use of news articles. It indicated willingness to ask the government to take necessary actions with an eye toward reviewing the legal system.