The JCPA Could Deliver Conservative News Outlets Seven Times as Much Revenue as Local Newspapers Backing the Bill
Why would Democrats back a giveaway to Fox News, The New York Post, and Newsmax?
As Congress nears the end of the year, there’s an active effort to include the controversial Journalism Competition and Preservation Act (JCPA) bill in the must-pass defense spending bill.
The current version of the bill allows eligible news organizations to organize and negotiate collectively to receive pay from large digital platforms — namely Facebook and Google. For example, if I did a Google search and one of the results was a link to a story in the Minneapolis Star Tribune, Google would — under the negotiations required under this bill — be forced to pay the Minneapolis Star Tribune every time a consumer clicked on that link.
The legislation is intended to help small local news organizations — however, numerous conservative media outlets like the Daily Caller and Newsmax also support the bill. As described by my colleague Adam Kovacevich, if the platforms refuse to pay news outlets, the outlets can bring suit against the platform — essentially guaranteeing some sort of minimum payment threshold will exist if JCPA becomes law:
But just how much would news outlets earn from JCPA’s payment scheme?
In order to analyze how much media outlets stand to gain from adoption of the JCPA, we looked at two categories of news organization: JCPA-eligible national conservative media outlets and eligible local news outlets that have written a pro-JCPA editorial in the past.
Based on website traffic data from Similarweb, we developed estimates of the annual revenue that these news outlets could receive from platforms for click-through traffic under JCPA. We used a conservative estimate of $0.01 paid per click; in reality, the actual payment amount resulting from these negotiations could be higher or lower than $0.01.
Similarweb develops estimates of website traffic using four source types of data, as shown here:
In order to develop estimates, we used Similarweb’s traffic data for Google and Facebook — two of the digital platforms targeted by the bill. For Google, the data provide information on whether the search and related traffic was organic or paid. Our analysis focuses on the organic traffic from Google to news organizations affected by the bill. The Facebook traffic data from Similarweb does not currently distinguish between organic and paid traffic for social media.
As mentioned above, we limited our analysis to consider two types of news outlets — national conservative news outlets and outlets that have written pro-JCPA editorials.
- The sample of national conservative outlets included Fox News, The New York Post, Newsmax Media, Inc., The Epoch Times, National Review, Washington Examiner, The Daily Wire, The Washington Times, and The Daily Caller.
- The sample of local outlets which have authored pro-JCPA editorials included the Boulder Daily Camera, The Pittsburgh Post-Gazette, The Santa Rosa Press Democrat, The Palm Springs Desert Sun, Decatur Herald and Review, The New Jersey Star Ledger, Minneapolis Star Tribune, Hartford Courant, The Mercury News, Milwaukee Journal Sentinel, Gwinett Daily Post, and Wisconsin State Journal.
The data we have access to is produced on a monthly basis and we use that information to scale our estimate to represent a year’s worth of time. This yields our estimated annual total traffic for Google and Facebook. Finally, we account for what percent of overall traffic to the news organization each digital platform provides. For example, if Google provides 50% of traffic to a website, then 50% of the total traffic to that website is attributed to Google within our data.
Recall that the JCPA provides collective bargaining rights to news organizations in order to negotiate with large digital platforms regarding payment to news organizations for clicks on their links that appear on the digital platforms. Because this negotiation process will occur after the passage of the law, the amounts agreed upon during the process may be higher or lower than the $0.01 estimate used in our analysis. But regardless of the actual price-per-click paid by platforms to outlets, the relative size of effects shown here remain the same.
How much revenue would conservative news outlets and local news outlets earn under the bill?
Now, let’s look at the estimated annual revenue under the bill to each news outlet, based on organic traffic from Google to each website.
In the chart below, national conservative news outlets are represented in red, while local news outlets that editorialized in support of JCPA are displayed in blue.
Based on the traffic data pulled from Similarweb, Fox News and The New York Post stand to see some of the highest revenue from passage of the JCPA among our sample of national conservative outlets and pro-JCPA editorial outlets.
For example, based on our revenue estimates, Fox News stands to gain almost 24 times as much as the Minnesota Star Tribune, each year, from Google traffic alone.
In the most extreme case, if we compare Fox News, the national conservative outlet with the highest estimated revenue in our sample, to the pro-JCPA local paper with the lowest estimated annual revenue, The Decatur Herald and Review, Fox stands to gain over 580 times as much as The Decatur Herald and Review per year.
In order to visualize overall differences across national conservative outlets and outlets with pro-JCPA editorials, the figure below shows data aggregated within outlet types.
Next, we provide the same analysis for Facebook. The figures below follow the same format as above, however now we consider traffic from Facebook.
The same pattern we saw with the Google traffic data continues with the data on Facebook. National conservative outlets stand to gain almost eleven times as much from JCPA passage than papers that published pro-JCPA editorials, based on Facebook traffic data.
However, the magnitude of the estimated revenue is much larger for Google traffic than for Facebook. The chart below provides a summary of the total estimated annual revenue gain from Google and Facebook traffic, within the same chart.
Based on the figures above, national conservative outlets as a group stand to gain roughly seven times the amount of money as the local papers backing JCPA. As we saw previously, the difference between individual papers can be extreme. However, even when aggregated within outlet type the difference in estimated revenue is striking.
Some Democrats support JCPA because they think it will help local news outlets in their district. But while the legislation does support local news organizations, conservative media stands to gain much more money from the bill. Let’s hope Democratic policymakers pause to ask whether this should be a priority as Congress wraps its work this year.
The Chamber of Progress (progresschamber.org) is a new center-left tech industry policy coalition promoting technology’s progressive future. We work to ensure that all Americans benefit from technological leaps, and that the tech industry operates responsibly and fairly.
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