Commentary

What Part Of Free Google And Facebook Traffic Does Corbyn Not Get?

It's hard to fathom the logic behind Jeremy Corbyn's latest suggestion about how to tackle the power of the US tech giants. Just about every news outlet in the UK is reporting today that the leader of the opposition wants to see a windfall tax on the tech giants that would pay for more independent journalism. Amazon, Netflix, Google and Facebook are the companies most frequently referred to.

The argument is that the tech giants have way too much power in our media landscape, yet avoid paying their fair share of tax, and this stunts the growth and viability of other media organisations.

Not sure if it's me, but isn't that the most ridiculous rubbish you've ever heard? Now, I'm the first one to say the US tech giants need to be held to account on tax. They use clever methods to legally (repeat, legally) avoid accounting for and paying full UK on profits that are derived from their business in the UK. Amazon, it should be pointed out, insists it now accounts for its UK business in the UK. 

The really stupid thing here is a tax system that allows this to happen. I'm all for taxing the tech giants in some other way. A digital sales tax is being talked about across the EU, and although it is not ideal, if companies can channel profits off to low tax jurisdictions, then it may be a last resort worth considering. 

The issue isn't really that the tech giants don't pay what may would agree is a fair share of tax. The issue is what to do about it, and why? Countries have a choice of either changing tax rules to stop this legal avoidance happening or coming up with a tax that can't be avoided.

The tricky thing with what Corbyn is suggesting is that this has something to do with the British media landscape. If he were referring to advertising, he would be bang on the money. The duopoly of Google and Facebook are on course to take two in every three pounds spent on digital marketing in the UK. They dominate -- and they suck money out of the UK but don't, many would argue, pay their full share of UK tax.

What this all has to do with the media is anyone's guess. It's no secret that Corbyn can't stand much of the mainstream media because of his past activities, such as the furore over anti-semitism in the Labour Party, and most recently, him being present when a wreath was laid in a ceremony a few years ago. I'm not touching that one with a barge pole, but if you want to read up about it, you can do so here

Could this opposition to the mainstream press and giants of the media be behind him suggesting a windfall tax be levied on those giants and used to fund independent journalism? He names the Bureau for Investigative Journalism as an example. 

Perhaps, but here's the thing. The tech giants are not in the business of producing the news. If anything, they are a conduit through which many people discover news stories. I'm not saying that more needs to be done to combat fake news and propaganda spread by fake accounts, but on the whole, Google's search results will point you to stories from the mainstream media, and so will shared headlines in a Facebook timeline. 

I have never understood the argument that this traffic generation is some enemy of the UK press. It simply denotes a new way of discovering content. It's up to the media organisations themselves to monetise this traffic that they get for free from the tech giants. 

When it comes to tax, I'm the first to wade into the tech giants, particularly when they are soaking up a majority of digital marketing spend. However, when it comes to the media, Corbyn's barking up the wrong tree here. I may be a bit "American" and pro-business in my views here, compared to the Labour Party leader, but anyone sending millions of eyeballs to British press titles, for free, can hardly be seen as the enemy? Can they?

Sure, tax the US tech giants to make sure they pay their way, but hold them responsible for what you see as the state of the British media landscape, and then make them pay to clear it up? There's just no logic behind it. It smacks of someone who hasn't delved deep but is just chasing a positive headline to get attention away from never-ending rows about anti-semitism in their party. 

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