Australia to make Facebook and Google pay news outlets for content

Platform Economy: Sydney, Australia is the home to many Aussie tech companies

Australia finalised plans on Tuesday to create Facebook and Google cover its media outlets for information content, a world-first movement aimed at protecting separate journalism that has been strongly opposed by the internet giants.

Under laws to go to parliament this week, Treasurer Josh Frydenberg explained the Big Tech firms must negotiate with local publishers and broadcasters just how much they pay for content that appears in their own platforms. If they can’t strike a deal, a government-appointed arbitrator will decide for them.

“This is a huge reform, this is a world first, and the world is watching what happens here in Australia,” Frydenberg told reporters in the capital Canberra.

“Our legislation will help ensure that the rules of the digital world mirror the rules of the physical world… and ultimately sustain our media landscape.”

The law amounts to the strongest check of the tech giants’ market power globally, and follows three years of inquiry and consultation, ultimately spilling into a public brawl in August when the US companies warned it may it may stop them offering their services in Australia.

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A representative for Google declined to comment on Tuesday, saying the company had yet to see the final version of the proposed law. Facebook was not immediately available for comment.

Until recently, most countries have stood by as advertisers redirect spending to the world’s biggest social media website and search engine, starving newsrooms of their main revenue source and bringing widespread shutdowns and job losses.

But regulators are starting to test their power to rein in the two mega-corporations which take more than four-fifths of Australian online advertising spending between them, according to Frydenberg. This year, a French regulator told Google to negotiate with publishers over payment for news content, and the matter remains before the courts.

“It’s both very ambitious and quite necessary,” said Denis Muller, an Honorary Fellow at University of Melbourne’s Centre for Advancing Journalism, referring to the Australian law.

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“Taking their news content without paying for it, in exchange for a very questionable reward of ‘reach’, seems to be a really unfair and irregular and democratically damaging arrangement.”

News Corp Australia executive chairman Michael Miller said the law was “a substantial step ahead in the decade-long campaign to attain equity in the relationship between Australian news media companies and the international tech giants”. In May, News Corp stopped printing more than 100 Australian papers, citing declining advertising.

In changes to draft legislation announced earlier this year which may favour the technology companies, the final version of the legislation would not affect news content dispersed on Facebook’s Instagram subsidiary or even Google’s Youtube.

But Frydenberg added into the list of media firms with whom the tech giants must negotiate, stating public broadcaster the Australian Broadcasting Corp and expert public broadcaster SBS would be included, together with dominant private sector outlets like News Corp and Nine Entertainment Co Holdings Ltd.

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The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Byron Kaye. Editing by Richard Pullin.

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