leaves markets with a sliver of the ads derived from their product. can you tell your experience with negotiating about big tech companies like google. >> there's no negotiation, there's no e-mail, no back and forth. and they don't give you that opportunity. and we've tried every way possible with both of them. the bottom line they don't get back to you and even worse, they make changes whenever they feel like it. we oftentimes over a weekend or overnight or in the middle of the afternoon, we'll all of a sudden have changes in terms of services that come down to us out of the blue and we just have to deal with it. there's not any kind of negotiation, not any kind of conversation. >> okay. and again, direct. dr. singer, news aggregator, such an apple news, facebook news, take various news from publishers and give it to consumers and it makes it very

difficult for newspaper publishers and other news sites to establish direct relations with their readers and to improve their own advertising operations. can you talk about the challenges faced by smaller media outlets which often find themselves in an unevening bargaining position with news aggregators? >> sure, there is a-- the challenge, of course, is more acute for the smaller publishers than the larger, because as a matter of bargaining position, they have less bargaining power, counter veiling power. i would say the asymmetry extends across the industry, not just smalls, but the medium and the large as well. the problem, the publishers cannot summon the will to do what's necessary to access is fair market payment to access, which is to shut down the access to google or facebook with their site. no one would rationally do

that? because they're beholden to google and facebook, and from those sites. the bill would do an attack the bargaining asymmetry would be to first allow the newspapers and news publishers and broadcasters to bargain collectively vis-a-vis the dominant platform. so i think to answer your question, yes, they're-- >> all right. i just want to ask one last question and that is you've heard from, i think it was mr. francis and my colleague over here with the use of the word news cartel about what this bill does and of course, there's been representative buck, conservative over in house, senator kennedy, not exactly liberal, both have just been added to the bill and there's a lot of interest to

this bill and i think it's important as we're looking at the changes we're making to make clear that there isn't going to be any kind of bias here, but that also, could you address this argument they've made that this creates some kind of news cartel? i'm only knowing the supporters of this bill in terms of the news organizations that run the gamut from liberal to very conservative and i find it impossible to see it that way, but could you comment about why this is not a news cartel? >> the concept of creating a cartel here is laughable and not economic, let me explain why. >> the news publishers would not get coordination rights in dealings with consumers, would not. if they got together and tried to set prices for end users, they would go to jail. the coordination rights that are delivered here are narrowly nail tailored only to the

dominant platforms and they wouldn't have coordination rights with respect to workers, wouldn't have coordination rights with buyers and the notion is fanciful and one other point, too, i heard mr. francis say it's going to result in higher prices, as you know, the cartel is going to exercise presumably selling power. that's false. just think about what would happen if the news publishers got their way and got the bill passed and there was an arbitration hearing, an award in the millions of dollars, what would happen? you'd have a large lump sum amendment on the revenue side and there's no theory in economics or pricing which i happen to teach at georgetown that would suggest a big large increase of a lump sum revenue would ever cause a firm to raise its prices to users, it doesn't make sense. as an economic matter, if someone in my class suggested

such, it would fall. >> don't worry, mr. francis, when senator lee or another senator returns, i myself may give a chance to respond. so just hold your beer. >> next up, senator durbin, we're thankful he's here as the chair of the judiciary committee, honored to have him here he's not officially of the subcommittee, but we thank senator grassley for his interest in this issue and help. mr. durbin. >> thank you, madam chair, i have to leave and thank you for putting me in the queue. and i heard about the cow bird, a brood parasite and meaning it leaves its in other species and they're looking for species laying eggs and once she has a host she'll sneak in when it's away damage or remove one or more egg and replace with one of their own.

the foster parents raise the cow birds usually at the expense of their own offspring. it sounds like analogy of something we're looking at here. it appears news organizations are creating news used by others that they aren't paid to create and the advertising money comes their way when they steal that content and put it on their own tech boards and such. and i'm wondering, is there a way to deal with this? let me quote one of the friend of mine, dennis loyal, you may know from the illinois broadcasters association and says the economic harm they're inflicting on local broadcast journalists is brought out, with radio broadcasters demonstrate add freefall in recent years due to almost exclusively the on-line

platforms who dominated advertising, and anti-competitive practices to protect it. so we're discussing the passing of j c pa. how with this help those broaders as dennis lyle represents? >> absolutely, absolutely it would help us to have all kinds of news operations to have a level playing field. i think that that's all that we're asking for is a seat at the table. we want to be able to negotiate. we want to be able to have a conversation, we want to jointly work together to try to have an outcome that will help small journalistic outfits, you know, including broadcaster, but including the newspaper industry, but in terms of broadcasting we desperately need this because we're fading away. we're having fewer and fewer

people involved in the news business and we've had a dramatic and steep decline and broadcasting now has seen tremendous amounts of people leave the industry. >> you know chicago. >> yes, i do. >> you've worked in chicago. >> yes. >> i can tell you in my senate career a little over 20 years there's been a dramatic change. a press conference in chicago you're lucky to draw one reporter, lucky. instead it's a bank of cameras and by union rules or by tradition, the cameramen don't ask questions. so you make your statement, and they look at you and you look back at them and that's the end of the story unless you want to start volunteering information and ask yourself questions. that's what it's come to in terms of what used to be one of the most vibrant news markets and competitive news markets in america. it's just disintegrated we now incidentally have a new experiment with the npr station in chicago, joining up with the

chicago sun times not for profit venture to deliver newspaper journalism and radio journalism through npr. i wish them well. we need people asking tough questions of politicians like myself. it's not the case. if nothing's changed. it's all going to go away and just going to disappear. >> that's my big concern, without something like the jcp a. we're not going to be able to cover council meetings or press conferences not going to cover local weather emergencies or traffic for all of these things are going to go away. what are you going to rely on then, your local list serve? the way it's been set up over the years to make it a-- go at it as a digital business i know that jennifer to go into it. the profits aren't there and lucky if you break even.

something has to change if we want local journalism to survive and jcpa could let us have a seat at the table so we could at least even the playing field. >> if we don't do something the cow birds won't have any nests to raid. >> they will not. >> thank you very much. >> mr. francis, first, i'd like to let you respond to point mr. singer made a moment ago, i was out in the hall and didn't hear all of it, but how he described, i think the word was laughable, the point i was making earlier that this bill would authorize cartel behavior. do you want to respond to that? >> thank you. yeah, for sure. so i understood dr. singer to suggest two things, both of which were pretty surprising to me and for anything of us in anti-trust involvement space. number one a cartel is only a

cartel if it deals with your dealings directly with consumers or workers. and that is really not right and that would be to the department of justice. he think some of the flagship enforcement actions have dealt with cartel agreements to harmonize on practice for sale to intermediate, and the lcd cartel, people went to prison for quite a long time for these things even though they didn't deal with consumers arn workers, a routine cartel enforcement. >> his conclusion is based on a distinction not recognized anti-trust enforcers at the department of justice? >> certainly doesn't deal with cartel sales direct to consumer and sales to an intermediate platform illegal. >> that wouldn't be a defense then? >> that would absolutely not be

a defense. second, i understood dr. singer to suggest that the cartel evercharge wouldn't increase prices, it's absolutely true for sure that a one-off lump sum payment would not have any effect on downstream prices. so if what we're talking about here is just cutting a check, a one-time check to google and facebook and it's back to business as usual forever-- i'm sorry, from google and facebook that alon is unlikely to affect downstream costs. i understand what we're talking about is an agreement that would lead to a rolling payment from google and facebook on an ongoing basis for news related activity on search engine and social media. i think it's pretty textbook microeconomics, if you take a monopolies and increase their costs then the maximizing prices flow increase, and i

understand that, not a single one-off lump sum payment to be what's contemplated here. >> thank you, that's helpful. just to be clear getting to the earlier point about the cartel, it's not like it's an off-shoot ramification of it. that's the point of the bill. isn't primary point of the bill to lawful what is now unlawful? >> and with the deals with the trading partner, that's a classic cartel. >> mr. gainer, isn't the problem for news publishers simply their advertising venue has been diluted by the advent of the internet and targeted digital advising? >> well, diluted even before the internet. and the congress passed newspaper preservation act of 1970 trying to stop newspapers from going out of business back then. and we ended up with more than two dozen joint operating

agreements back then. look, people live their lives on-line as much as a country right now and in two years of covid restrictions have encouraged them. and people aren't going to advertise it, not going to stores, not going to restaurant and that's everybody for the business center that we're talking about here. >> so, i've got a chart and i don't know whether you can see it. digital advertising revenues have increased severalfold while the areas in newspapers have more competition, classified ads and retail ads have declined precipitously. how much of this is a big tech problem versus how much of it might be a matter of business choices and how they interact with emerging technologies? >> well, i'd say it's a mix of both. you look at that, look at the

numbers, and they're all declining. in baltimore where i grew up had three newspapers and died in 1986 before the internet and the evening sun shut down shortly after the internet. that wasn't caused by the internet. so the problem was news publishers, specific ones didn't reinvest for the future and you know, now we've seen the ones that are doing well are vertical, and very specialized. the new york times political, washington post the same. sports, other things like that. local news isn't doing as well because it's just not doing well across the board. >> thank you. mr. francis, to be clear when we're talking here about what is at risk, what is at stake, what's suffering. we're not talking about the

death of journalism itself? we're not talking with the idea that journalism itself can't be economically viable in the absence of this. we're talking more, i think, about whether certain business models followed by some in the news publishing industry are viable, is that correct? is that consistent with your understanding? >> i think that's exactly right. i think that local news is clearly critical. i grew up in a very small english village where when the life magazine or the villager or the town cryer, our local newspapers would land through our letter box, everybody in the house at some point that week would read it and learn a bunch of things we wouldn't find through other channels, local media and news are critical. exactly as you've described, what's at stake here is the manner in which local news will survive. >> right. >> and it's very clear that the business model is responding to competitive pressure.

>> so what that suggests is that some businesses-- journalism it's self is at take and some business models will survive better in that environment. i'm certainly not an expert in the news publishing business, never purport to know the in's and outs of that business, but i think it's fair to assume that you can identify a certain subset. i don't know exactly how big it is, a certain subset within the news publishing industry that has adopted a business model that's not succeeding, it's not going to succeed. is it generally good policy from the standpoint of promoting competition for the government to step in and sanction the formation of a cartel in order to save a particular business model that's dying? >> it's almost always not. and that's not to say that we look with anything other than

horror and sadness at the real difficulties that competitive change brings. so, particularly with the transition to digital business model, we've seen from one sector to another, legacy business models experiencing real difficulty as they transition to something that makes economic sense and is sustainable in the economy as it's emerging today. >> horse and buggy to automobiles? >> exactly. video rental stores, film in camera and we see the story and there's suffering sewed associated with that. if you believe in anti-trust and the process that anti-trust is there to guarantee and without tolerating and allowing some degree of failure, some agree of comfort, exit times then you don't have competitive and it's not clear what the anti-trust project is for. as difficult as it is, the

pains exactly as you describe are a part of the process. >> i like your comparison to the home video industry. the consumption of home video entertainment didn't die. netflix emerged long before it was an on-line streaming company, and it survived, where blockbuster didn't, they had a different delivery method. particular business model succeeded over others, mr. blumenthal. >> thank you very much, senator lee. thank you all for being here today. there are moments in the united states senate, i've found in my 10 years here that america comes to one of our hearings. america comes before us and i think that we have that moment today. it is a moment for america about a failing industry that's been the life blood of america,

going back to the founding of our republic and it is part of the genius of america that we have local journalism which covers local stories and provide a local forum for people to be informed. one of the ironies here is that big tech is using information in effect to dominate. and it's information that is collected in all kinds of ways that local journalism simply doesn't have the power to do and then it is used in effect to suffocate other sources of information namely, local journalism numbers. and now increasingly, broadcast. to all of the sophisticated economic arguments that might be made against this act, i

think ms. bertetto, recounting what was told to her by someone who was asked, google doesn't like it and google owns everything. that's the nature of the power here. and so i would like to say that the market will self-correct, that we can use existing anti-trust law, but it ain't working. it isn't working for the heartford current. which was weakened and then taken over. and its fate is uncertain. it was taken over by a vulture hedge fund, alden capital which has been seemingly selling off its assets, taking advantage of its real estate, of other

assets. in no way caring about seemingly its journalistic staff or even quality. and they've cut staff, in fact, at twice the rate of their competitors on the bright side, the connecticut mirror in connecticut has enabled vibrant democratic debate and discussion, but it is a nonprofit. it depends on donation. it has discussed in recent times the importance of local elections and local reporters and public officials, including myself, accountable to the people that we serve. so mr. singer, let me ask you and any of the other panelists that want to comment, i'm a supporter of this measure, but i wonder, are we too late?

can we still rescue american journalism? >> i don't think we're too late, senator. what we-- what this enforcement mechanism would do would provide for a payment to a collective or a coalition of newspapers or news publishers that would attempt to approximate the fair market value of what they are contributing to the platforms in terms of users and clicks and the like. and so, if we can put money back into the pockets of the flues publishers, i think we can breathe life back into the industry and that money would eventually go down to the journalists and workers and input providers that go into the production of news. >> ms. bettetto and mr. ross

over to you. >> what is at risk here is local news, that's really what is at risk. huge news operations, yes, they will be fine. but when you talk about local news, local news is in a lot of trouble, broadcast or print, and i have experienced it even in the washington d.c. area. there is not a viable economic model that i have ever seen for local news to be all digital. it just doesn't work. the money is not there. and so that's very distressing, and over time, i think, while are we too late? no, i don't think we're too late, but we're getting close. we might even be in the 11th hour because it's getting there. this is getting very dire. and i look at it, you know, we're also a platform, too, hey, we're aggregators, we're good with that and we understand that and we're a platform that pays for the news content. i don't think the associated press would like it very much if all of a sudden we didn't

pay for their content and in many respects, i think that's what's happening here is, you know, the facebooks and the googles get the advantage of it, but don't have to pay for the content and the true down fall of local news, you're just not going to be able to find a revenue. >> i can't sit here and pretend that as an industry we have done everything correctly, you know, there are certain things that over time we have made missteps. but -- and i feel like the jcpa is one aspect of what needs to happen for our business models to happen in the future. it's one piece and there's responsibilities for us as publishers, to work on solutions to make our businesses successful. our company, for example, we've gone to great lengths to

diversify the revenue streams and it's creative solutions necessary for all of us. jcpa won't fix all of our problems, but it will fix one of them. >> thank you, my time expired. this topic is urgent because we're in the 11th hour or maybe toward the end of the 11th hour. once these institutions are gone, they're gone. there's no reconstructing them, at least with the quality of excellence that we've seen over so many years in exposing corruption and enabling information about school boards and holding accountable public officials. so importantly at the local level because it's irreplaceable and indispensable. >> thank you. i believe senator blackburn who was here diligently early is

now on remotely and then we go to senator padillo and then fine for voting. >> thank you madam chairman and thank you all. what an interesting panel and i really appreciate the testimony that you got to us and that you came to give today. i want to start with you, your organization has put a lot of attention on bias in the mainstream media. and how big news and big tech team up and filter the news and really takes control of what you hear and what you see when it comes to news, and when i go to tennessee i hear a lot about this from tennesseans and they don't like it. they feel that their views are not being represented and that

they're very concerned about if they can or cannot trust mainstream media. so we thank you for the work that you're doing on this front, but i'd like for you to touch on what small news outlets are doing that will help to combat that bias, what you all are seeing that they're doing. i think it's important that they do that so if you will just very quickly touch on what are the best placed efforts for combatting this bias from the coziness of big tech and big news? >> first of all, thank you very much, senator. we've seen examples all through even recent presidential elections of the problems of big tech and by big journalism not covering major issues and it's the difference between, you know, corporate media, which what they're talking about there and several people on the panel right now.

and the local journalism is something that we all love and it's the heart of the community and on national, and we have the incredible biases from the traditional media, the legacy media and working hand in hand with the same people that i think we all want to beat up on right now, with google and facebook and others. and so, the scary idea here of creating, you know, a cartel or whatever you want to call it, some sort of organized unit where the major players in journalism, "the washington post" and new york times who didn't stand up during the hunter biden story and didn't cover that story while the new york post was cencored. >> let me jump this there, we

want to make sure that local news that you're going to give local news what you need to be competitive that you're not going to cut them off and i think that everyone would agree with that, but what we don't want to do is do something that's going to have the unintended consequence of that. and mr. francis, let me come to you. do you think that companies like facebook, like instagram, youtube which stands to benefit from an anti-trust exemption, and what bad behavior could they get away with if they did get that exemption. >> and what i understand this proposed exemption would work the other way around in the event that this were created two things would happen. the first is that the most immediate beneficiaries would

be the participating media companies, obviously, including some very large conglomerates, as well as the smaller publishers that we're talking about. and certainly the cartel overcharge that would emerge from agreements on prices would be paid in the first instance by google, facebook, and then transmitted, most likely in the form of higher prices for advertising down the chain to consumers. >> so basically what you see is more hands in the pot for the money that is there, adding extra layers of feed so in the -- fees so the originators of the content gets no more, but you're going to have the conglomerates with more profit, is that what you're saying there? >> that's correct. there would be a charge at the top--

>> let me ask you this, the music industry, when it comes to royalties and some really tricky royalty issues, what we've done through the years is look at how they operate under consent decrees, and a few years ago, we had to work diligently creating the music modernization act, it's something that was very concern to a lot of my tennessee constituents. so, do you see something like the music consent decree being needed if the grants and anti-trust exemptions? >> so my sense is, and i am not an expert. it's been many years since i worked on music licensing and the process under the consent decrees that you mention. but i'll say a couple of things, the thing number one, i think that's been an extremely complicated, difficult, and controversial process for a very long time, in a way that i think would exemplify some of

the difficulties if we were to embark on a similar price setting mechanism here, for example, with, in a compulsory arbitration mechanism and number two, many of the music licensing examples are situated because there's a compulsory obligation. the licenser has an obligation to issue the license and complicated effects for how you want to set up your system and i don't think that anybody is talking about creating a statutory obligation here on news publishers to issue a license, but i'm really not an expert on music licensing in particular, so, everything that i say about it should be taken with some caution. >> i appreciate your candor. thank you all. thank you, madam chairman. >> okay. very good. thank you senator padilla. >> thanks, madam chair. let me begin my thinking the witnesses on your testimony on this very important topic.

>> it's not an understatement to say that our democracy depends on a healthy and vibrant eco system, via a reliable internet connection that people are equipped with information and meet the literacy skills responsive to today's compressed content streams, and it they're served by a thriving free press, that includes media outlets, journalists and broadcasters that both reflect and are responsive to the diversity of our nation, and economic recessions and a loss of advertising revenue has devastated the news industry. and the last 20 years, more than a quarter of the country's newspapers have disappeared. local, regional, community, and independent media are understaffed, underresourced, and in need of assistance as

they work to identify new sustainable business models. it's critical that congress explore how we can assist the news industry as it tries to find its footing during this transition period. miss bertetto, i know from personal experience that local news is so vital to keeping communities in california informed, particularly during elections, for example, or during and after natural disasters. can you discuss what's at stake if local and community facing news outlets disappear, particularly when it comes to our democracy or public safety? >> of course. so our readers, again, being a small publisher in pennsylvania, rely on us for the information they're lit

e.r.ly-- literally not getting anywhere else, that's covering city government and letting them know when the bridge is out in their community. that's letting them know when the senior citizen center is going to be open during the cold winter months and heating stations. we often provide that very content as well to the television broadcasters. so, often they're relying on us to inform them so they can spread the message through their channels. obviously, as newspaper staff continues to dwindle. what will become very problematic, there will be no one, you know, "the washington post" and the new york times will probably be fine no matter what is decided, but new kensington pennsylvania won't be. who is going to report on flu kensington, pa if my company isn't doing that. how are we going to have an

informed electorate? how are we going to have a society that understands what is happening in local government, state government and national government if my company is not providing those resources? >> thank you, those are great examples. i appreciate that. not every bridge failure makes national cable news. >> exactly. >> and how contentious school board meetings are in this day and age. given the importance of local news rooms for our democracy, news room employment in the united states has dropped by 26% since 2008. miss bertetto, you testified that the jcpa would help smaup small business investments into the community and hire more reporters. and can you discuss the importance of explicitly tying

benefits to job creation and retention? >> presently, in our company about $7 million is paid out in salaries to journalists on staff. to give you some sense of what we earn presently from google, it is 144,000 a year. so i really feel i'm starting at zero and any additional monies that could come in could certainly help to keep, first, keep reporters on so we can stop this decline because it's astronomical, the number of reporting positions i'm seeing leave our markets. i also think that with, you know, when you're looking at $144,000 and say i can get 600,000, just for example, i could cover more communities.

i could add these. i'm presently making decisions every single day about which communities we can afford to have a reporter in on a full-time basis and where we have to decide to have a part-time reporter or no reporter at all. any additional economic relief to help me avoid those decisions would certainly be welcome. >> mr. oxley. >> and the same goes for us, our sizes aren't that different. our news room costs about $12 million to run every year and what we're finding is more and more has to be switched to the digital side. even though the digital side really doesn't make its money, at best over the years broken even. in the last 10 years our overall digital revenues off of our website have barely moved and the costs have gone up a lot. so if we were able to have money come in and i think that the jcpa could provide that by

having a level playing field and seat at the table, we would be investing. it's the thing that i get all the time from all the people on the content side and the program side. can i add people? of course we would like to add people. and also, our area has grown exponentially. it wasn't that long ago that the whole area in washington d.c. was three million people and now six million people and now it's been able to grow in size because we haven't changed in terms of are growing our people. the very first they think we would do is add journalists, and the journalists that we would add are professional journalists, they're not doing people doing click bait. they're doing real stories, educated to do that and we have a saying in our operation, before you do it first, first get it right. that means sources, doubling,

trim tripling, quadrupling to get the facts. >> madam chair, just in closing and i flo know that the conversation has gone in what direction the industry has to find solutions short and long-term during this transition period during the ongoing conversation of what else congress can be doing both in the short-term and the longer term to help the news industry. thank you very much. >> okay. so thank you, senator padilla. i think it's just down to senator lee and myself and i'm going to have to leave at about five to 5:00. so i'm going to let him maybe do five minutes or so and i'll have two more questions and we can go from there. >> thank you. let's go back to you, if that's all right. how do you believe that

consumer trust or distrust of news publishers might impact your success? i ask because at the edelman trust barometer as displayed in the chart behind me shows had a growing distrust of the media across the globe. 46% of people around the world view government and media as divisive forces in society and 74% of americans worry about fake news. how do you think political bias or including anti-conservative censorship, might have contributed to that mistrust. >> i think it helps to contribute to it a lot, both on, you know, big tech side and on the media side. and again, you know, talking about corporate media and it's on the local news and when

ordinary americans think about media they're generally not thinking about their local news outlet or weekly newspapers, their radio stations, they're thinking about larger media, thinking about media they see on tv and then also thinking about the big tech. i mean, to make going to war with big tech, i think that conservatives would be very happy, but that, but the question does this still work to do that? and you know, when you look at the years of, you know, graduate decline of people's interest in media and also look at people's-- the rising times, and people trusting media, the two tracks are very similar. >> it makes some intuitive sense and there seems to be anecdotal support for that, at

least intuitively, it makes sense to me. now, the congressional research services noted that 70% of daily newspapers are owned by private equity firms, hedge funds or groups, nothing wrong with the business models, but the data that i've got. do you think that these owners are necessarily going to be more concerned about investing in journalists and quality journalism than they are about getting a return on investment and regardless, would the jcpa make a difference in that regard? is the jcpa going to change the place for these businesses one way or another? >> it doesn't seem like it.

you look at "the washington post," for example, the post is-- its identity is as a national newspaper. when it owned a chain weekly popular in suburbia, and from the baltimore sun, they had a chain of weeklies that they gutted to the point they're -- and that's been an ongoing problem. you know, not because of local ownership. local ownership, which i think is reflected on this panel, local ownership tends to care about the local community and national ownership, 70%. then they're not necessarily to the readers and their viewers. >> mr. oxly, while i'm never going to support legislation that i believe attempts to improve competition by forming a cartel, as this one does, if

the purpose of something like the jcpa is to protect small and local publishers, why not limit the bill's scope? why not limit its application to small and independent local publishers? >> well, i don't know the in's and outs of that as well as an awful lot of people in this room and i haven't been able to look at the in's and outs of the bill and how to works. >> are you saying you would support it if it was so limited? >> i would certainly support anything that would help local news. i feel at this point that we're in a really, really tough spot with local news and that's to me what we're talking about here. we're not talking about the national news players, local news players are still some of the most trusted in america, and study after study shows that your local news people are trusted and that they're very favorable view of them. and you know, the national is a different story, but locally, and we need something to help

out, truly help out the local news providers. >> so then, but if that's the case, if we're going to make it as most of this discussion today has been, if we're going to make it about the local folks, then why not limit it to them? dr. francis, i assume you'd agree, if-- with the discussion that if you buy into the notion that creating a cartel or a type of cartel's permission slip is acceptable for one universe, you could reduce the harm inflicted by that universe where cartels are authorized by reducing the scope. and in this case, since most of the discussion has focused around small independent local publishers, couldn't that have that effect? >> i think that is exactly right, senator. you've heard, i have pretty

strong feelings about cartels, but i don't object in principle anything like so much to the idea of supporting local struggling newspapers publishers, so at a minimum, restricting the scope of what you're describing, or restricting in the way you describe the scope of the exception so that it's truly targeted at install, struggling publishers, we can avoid conferring the ability to add a cartel overcharge to large, very profitable media companies, that would really help. i am pretty uncomfortable at this moment in our sort of political life about taking a big bite out of anti-trust when we should be reinforcing it. i'd like to talk about other ways to support local news, any support mechanism should be targeted to those who really need it not to the most prominent publishers. >> is there a risk focus ong this particular issue, it might draw attention away from other

things, other things that need to be addressed and including the problem with google and facebook? >> i think that digital monopoly, and monopoly in general is a problem that overmatches our anti-trust agencies. i'd love to me more funding and resources, the most recent need we have in politician commission in this country even more, is money and personnel to the agencies. and that's where i would love the focus of the conversation to be. that's what i think is top of the wish list. >> thank you. >> thank you very much, senator lee and thank you for-- i'm sure you have other questions for the record. thank you. >> and mr. francis said something where we agree on the funding for the agencies and as you probably know, senator grassley and i have a bill that have passed the senate, actually, to change merger fees and make it easier for smaller mergers and harder for bigger

ones-- maybe not harder, but more expensive to help pay for the agencies to be able to do their reviews, as well as some other funding mechanisms that we're working on. a few things, i'm just going to -- a few questions here at the end and be brief here. dr. singer, as i work on the electoral count act. dr. singer, if your opinion should news organizations have a right to be compensated when digital platforms take in profits from detailed snippets? i think it's a little more than snippets of copyrighted con at the point in time. they're claiming it's fair use and i'd like your response. >> yes, they should be compensated for any value that is being conferred from the newspapers to the platforms, including when the platforms scrape and index and use rich texts and images to decrease the likelihood of a user actually clicking on the link. i'd like if i could just to

address the cartel pricing increase that mr. francis is saying, he did admit if there was a one time lump transfer to the coalition, there would be no crease increase by the papers. that's the most important mission than we heard today. what he said next, on economic again, if it were to recur every five years, then there would be a price increase of some sort. i can't follow what the economic logic is and i start, maybe he's talking about a price increase by the platforms, but i want to rebut that as well. the platforms, as you know, senators has used a free price, zero price model. and the notion it's $5 billion every year for the payment of access is going to induce them to suddenly abandon their

consumers by search and access to the platform is uneconomic, i can't say it nicer than that. therele be no cartel price effect from this lump sum transfer, you can take my word for it. >> okay. thank you dr. singer some quick questions about some of the concerns that we've heard and of course, i've mentionled we're making revisions with the house to the bill. are the changes we should consider to ensure that small and local news organizations benefit from joint negotiations and can exert appropriate level of control over the process? >> yes, i understand there are certain provisions in the bill that would protect small publishers and the most important that comes to mind is the nondiscrimination provision, a small newspaper that wanted to apply for the coalition could not be discriminated against based on its size and viewpoint and that's important and they could get access to the bargaining

coalition. the second thing i understand there are voting rights when one member votes. smaller newspapers or members of the coalition must be protected and their interests must be protect that had way. >> should we consider changes to prevent discrimination? this has been raised by some of my colleagues in the joint negotiation process, against news outlets carrying content that expresses different or even unpopular views either from the left or right and i know we have support from this bill, some of my colleagues have noted from news organizations that they consider left and then we have support from letter in support of the bill, washington examininger, washington times, daily caller, not exactly a bastion of liberal organizations. ...

and if joint negotiations with the dominant platform stalls should congress provide arbitration to resolve the impasse? >> yes. binding arbitration is critical because it is possible for google or facebook to check all the boxes and abide by the good-faith protections during the good-faith negotiations. it's very important they look down the road and see if they do that they are going to be faced with binding arbitration again at which point a panel of say three arbitrators would make a determination as to whose estimate of the fair market value was fairest of them all. most closely approximated, the value being conferred by the news publishers onto the platform. >> okay. that's one proposal, thank you. as we finish up this bill. i also would like to enter a set of more than three dozen letters from newspapers, news organizations into the record. those letters focus on the state

of competition and journalism and the need for solutions like the journalism competition preservation act which is bipartisan both msn and the house. we also have a letter from lee enterprises, no relation, discussing the challenges the industry faces from those who would exploit it for short-term profit opportunities as well as a few others. but those in the record. i want to thank you all for being here. local news is a foundational importance to our democracy. i want to thank our witnesses today for their testimony. so many senators from different parties, different views, as you can see came together today. that's part of the exercise of free speech and part of being a senator and senator lee and i truly enjoy doing these hearings and really appreciate it. i want to get something done here. that is my goal, and we want to make it work for this country. so the record will remain open

for one week until february 9. thank you. you want to add anything, senator lee? okay. well, thank you very much to all of you. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]

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