VoxEU Debate: Regulating the Media Industry

Media consolidation in Western democracies has been dramatic in recent decades. This can be related to the growing market power of global digital platforms that weakens existing national regulations.  

From the point of view of antitrust, the market power of global platforms raises a number of new challenges, in particular given that the media industry is different from other industries: it indeed produces a public good, “information”. Regulating this industry is made particularly difficult due to the fact that media owners face both profit and political motives. With the rise of the platforms, the existing business model of the media industry has been weakened, with a notable drop in the advertising revenues that were previously relied upon by a number of traditional actors. Hence, political motivations often seem to prevail over a purely industrial approach of the sector.  

There is a great deal of work that need to be done on how to ensure media plurality, especially regarding the rules that should regulate media concentration. Anti-trust regulators play a key role here, and they face major challenges due to the rising competition coming from global actors (social media, search platforms and VOD services) that raises a number of issues, in particular regarding the definition of the “relevant market”.  

The key question – for both economists and lawyers – is to determine how one could efficiently regulate the media industry at the local/national level when important players on the market are global firms. For example, foreign ownership restrictions in the media industry exist in a number of countries – but while they apply to print and broadcasters, they do not affect platforms such as YouTube, despite this social media being one of the most popular sources of information. One of the central challenges in the future will be to determine how to ensure that such a regulation will bear upon to both national and global firms.  

Frontier research which can help inform these critical policy debates for the years to come are welcome. Please submit your contributions by email to [email protected]rg.