Australia to make Facebook, Google pay for news in world first

Australia has introduced legislation to force tech giants like Google and Facebook to pay news media publishers for their content

The Scott Morrison-led government in Australia had late a year ago told Facebook and Google to negotiate a voluntary deal with media companies to use their content.

"Today's draft legislation will draw the attention of many regulatory agencies and many governments around the world", he said.

A public-comment period on the proposed rules runs until August 28 and final legislation would be introduced in Parliament soon after that.

In releasing a draft of a mandatory code of conduct on Friday, the government aims to succeed where other countries have failed in making the global digital giants pay for news siphoned from commercial media companies.

Treasurer Josh Frydenberg reported Google and Facebook would be the initially digital platforms specific by the proposed laws, but some others could comply with.

Google Australia managing director Melanie Silva also says "nothing is off the table", amid speculation it could remove Australian news content from its site in Australia, if the draft mandatory code goes ahead.

Silva further added, "Instead, the government's heavy-handed intervention threatens to impede Australia's digital economy and impacts the services we can deliver to Australians".

The initiative has been closely watched around the globe because news media have suffered as tech giants like Facebook and Google hoover up the advertising revenue that once helped support them.

The crisis has been exacerbated by the economic collapse caused by the coronavirus pandemic, with dozens of Australian newspapers closed and hundreds of journalists sacked in recent months. Under the ACCC's code, news media businesses are expected to gain access to flexible user comment moderation tools, including an ability to turn off comments on individual stories they post to digital platforms.

The move has been strongly pushed by Australia's two biggest media companies, Rupert Murdoch's News Corp and Nine Entertainment, who stand to gain the most from the crackdown.

"While other countries are talking about the tech giants' unfair and damaging behaviour, the Australian Government and the ACCC are taking world-first action".

The code is aimed at giving Australian traditional news media more bargaining power with the tech giants.

"There is a fundamental bargaining power imbalance between news media businesses and the major digital platforms", said Rod Sims, the chair of the competition regulator, the Australian Competition and Consumer Commission.

Following an inquiry into the state of the media market and the power of the US platforms, the Australian government late a year ago told Facebook and Google to negotiate a voluntary deal with media companies to use their content. Media companies including News Corp Australia, a unit of Rupert Murdoch's News Corp, lobbied hard for the government to force the USA companies to the negotiating table amid a long decline in advertising revenue. We want it to be in accordance with our law. "And we want it to be fair".

If a pricing agreement can not be reached after three months, arbitrators will make a binding decision.

Breaches of the code could attract penalties of up to 10% of the platform's annual turnover or a 10 million Australian dollar ($7.2 million) fine.

"We wanted a model that would address this bargaining power imbalance and result in fair payment for content, which avoided unproductive and drawn-out negotiations, and wouldn't reduce the availability of Australian news on Google and Facebook".



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