STUDY R equested by the IMCO Committee Societal costs of “fake news” in the Digital Single Market Policy Department for Economic, Scientific and Quality of Life Policies Directorate-General for Internal Policies Author: Prof. Divina Frau-Meigs EN PE 626.087- December 2018 DO NOT DELETE PAGE BREAK Societal costs of “fake news” in the Digital Single Market Abstract This study explores the mechanisms of “fake news” and their societal costs in the Digital Single Market. It describes the risks to the integrity of information and to the integrity of elections. It highlights the roles of the various actors involved in the production and amplification of such information disorders. Finally, it outlines responses that are being tested in different parts of Europe to deal with the issue. The document has been provided by Policy Department A at the request of the European Parliament Committee on the Internal Market and Consumer Protection. This document was commissioned by the European Parliament's Committee on the Internal Market and Consumer Protection. AUTHOR Prof. Dr Divina FRAU-MEIGS, University Sorbonne Nouvelle, Paris, France ADMINISTRATOR RESPONSIBLE Mariusz MACIEJEWSKI EDITORIAL ASSISTANT Irene VERNACOTOLA LINGUISTIC VERSIONS Original: EN ABOUT THE EDITOR Policy departments provide in-house and external expertise to support EP committees and other parliamentary bodies in shaping legislation and exercising democratic scrutiny over EU internal policies. To contact the Policy Department or to subscribe for updates, please write to: Policy Department for Economic, Scientific and Quality of Life Policies European Parliament B-1047 Brussels Email: [email protected] Manuscript completed: November 2018 Date of publication: January 2019 © European Union, 2019 This document is available on the internet at: http://www.europarl.europa.eu/supporting-analyses DISCLAIMER AND COPYRIGHT The opinions expressed in this document are the sole responsibility of the authors and do not necessarily represent the official position of the European Parliament. Reproduction and translation for non-commercial purposes are authorised, provided the source is acknowledged and the European Parliament is given prior notice and sent a copy. For citation purposes, the study should be referenced as: Frau-Meigs, D., Societal costs of “fake news” in the Digital Single Market, Study for the Committee on the Internal Market and Consumer Protection, Policy Department for Economic, Scientific and Quality of Life Policies, European Parliament, Luxembourg, 2018.© Cover image used under licence from Shutterstock.com DELETE IF NOT SHUTTERSTOCK Societal costs of “fake news” in the Digital Single Market CONTENTS LIST OF ABBREVIATIONS 4 LIST OF BOXES 5 LIST OF FIGURES 5 LIST OF TABLES 5 EXECUTIVE SUMMARY 6 1. INTRODUCTION 9 2. SPECIFICITY OF DIGITAL DISINFORMATION AND INTRINSIC MECHANISMS 10 2.1 The disinformation trap-situation 10 2.2. From “fakenews” to malinformation 13 2.3. Major mechanisms 14 3. SOCIETAL COSTS 16 3.1 Fakedom in all sectors 16 3.2. Cost to journalism and risk of harm to integrity of information 18 3.2.1. Concentration of ownership and advertising 18 3.2.2. Convergence between mass media and social media: friends and foes 20 3.3. Cost to integrity of elections and hybrid threats 21 3.3.1. Public relations vs. journalism 21 3.3.2. Vulnerability of elections 23 4. RESPONSES : FROM SOFT TO HARD TO SMART 25 4.1. Self-regulation: fact-checking on the rise 26 4.2. Regulation: towards a transparency agenda 28 4.3. Media and information literacy: smart sense-making 30 5. CONCLUSION: TOWARDS A NEW PHASE OF CO-REGULATION AND RE-INTERMEDIATION 32 REFERENCES 34 REPORTS 35 DOCUMENTARIES 35 PE 626.087 3 IPOL | Policy Department for Economic, Scientific and Quality of Life Policies LIST OF ABBREVIATIONS AMP Accelerated Mobile Pages API Application Programming Interface CBS Corporate Broadcasting Service CPM Cost per Mile CSA Conseil Supérieur de l’Audiovisuel DDoS Distributed Denial Of Service GAFAM Google, Apple, Facebook, Amazon, Microsoft GDPR General Data Protection Regulation H2020 Horizon 2020 work programme IFCN International Fact-Checking Network MAS Media Accountability System MCN Multi Channel Network MIL Media and Information Literacy NATO North Atlantic Treaty Organisation OSCE Organization for Security and Cooperation in Europe PAC Political Action Committee PISA Programme for International Student Assessment PR Public Relations 4 PE 626.087 Societal costs of “fake news” in the Digital Single Market LIST OF BOXES Box 1: The “Donald Cook” Story 9 Box 2: Examples of international initiative in fact-checking 26 Box 3: Examples of MIL good pratctices to counter “fakenews” 31 LIST OF FIGURES Figure 1: The (dis)information ecosystem 12 Figure 2: The three layers of malinformation 12 Figure 3: Two-Stepped Convergence of mainstream mass media and social media platforms 20 LIST OF TABLES Table 1: Social media revenue 11 Table 2: Most shared climate article on social media 18 Table 3: The biggest media corporations in the world 19 Table 4: Spending on political advertising in USA (2008-20) 22 Table 5: Trust in journalism (2018) 27 PE 626.087 5 IPOL | Policy Department for Economic, Scientific and Quality of Life Policies EXECUTIVE SUMMARY The “fake news” phenomenon has come to the centre of public and political attention since 2016, with the suspicion that several electoral events (elections in the U.S. and in France as well as referenda in the UK and Catalonia) have been tampered with. In all cases, the role of social media platforms as major vectors of such disruptive phenomena has been questioned, especially with scandals such as Cambridge Analytica’s use of data from Facebook, and court cases such as Internet Research Agency vs. United States of America. As new elections are approaching in European countries, in particular the European Parliament´s elections in May 2019, it is urgent and necessary to evaluate the extent of the situation and adjust the necessary responses, especially in relation to trust in the Digital Single Market. The purpose of this in-depth analysis, provided at the request of the European Parliament’s Committee on the Internal Market and Consumer Protection, is to set the general framework for understanding the issue of “fake news” and how it can affect trust in the Digital Single Market. The paper offers an explanation of the phenomenon of “fake news” and indicates its evolution, from past processes to new specific incidents, differentiated from neighbouring concepts, such as propaganda or conspiracy. It provides for some elements of categorisation of “fake news” and illustrates their specificity in the XXIst century both with regard to the societal weaknesses that make Europe especially vulnerable to “fake news” and communication innovations that drive them. It redefines “fake news” as “malinformation”, i.e. the triple conjunction of human malevolence, marketing malpractice and engineered malware. It situates malinformation in the family of information disorders such as misinformation, online radicalization and hate speech. The analysis also reflects on the societal costs of this malevolent combination. Among these, there are economic costs but also, most important here, two major societal costs: the integrity of information and the integrity of elections. As regards integrity of information, the paper points to the numerous asymmetries that exist not only between mainstream mass media and social media platforms but also between social media in the U.S. and in Europe. The European digital market has not been able to create search engines or social networks large enough to compete with the American ones. Many asymmetries between American and European companies are immediately apparent: tax obligations, social responsibilities, advertising constraints and public service obligations (like diversity, pluralism, and protection of minors). So nothing hinders the American-based social media from spreading malinformation to increase traffic and thus profits. These asymmetries increase risks of harm to legitimate information as it becomes extremely costly to produce and puts quality reference media under pressure to yield more verification of news, which in turn increases costs and adds time delays. All this takes place in a context of increasingly concentrated ownership and pressure for profits from share-holders and directors who consider information to be an appendage to their larger sectors of activity which can include construction, defence or other economic sectors without long-standing interest or competence in news. As regards the integrity of elections, the paper describes the emergence of “hybrid threats” and the increased capacity of malign foreign intervention into EU affairs as the tension grows between democratic regimes and authoritarian regimes. Various phases of malinformation are described as well as the e-repertoire of strategies that recombine different mechanisms of malinformation into hybrid threats. Among the most characteristic elements are the drip dissemination of topics likely to create viral trends and polarization of topics well before the election time; the hack and delivery of strategic data to cause surprise or panic at determined stages of a campaign; the whitewashing of “fake news” via social media to promote amplification via mass media and conversely, and opportunistically, secret 6 PE 626.087 Societal costs of “fake news” in the Digital Single Market collusion or objective alignment of interests