‘World is watching’: Tech giants to pay for news
Australia is on track to become one of the first countries in the world to force multibillion-dollar tech giants Facebook and Google to pay for the news they use after the Federal Government confirmed it would introduce digital news laws into parliament tomorrow.
Federal Treasurer Josh Frydenberg today confirmed the news code would deliver a "huge reform" to Australia's media landscape when passed, and said the "world is watching" the nation's progress.
However, the Government has not yet revealed the finer detail of its proposal and it is unclear how Google and Facebook will respond after both companies publicly campaigned against the reforms, and Facebook threatened to remove all news content from Australia if it came into force.
The news bargaining code - first recommended after an 18-month investigation into digital platforms by the Australian Competition and Consumer Commission - will see Google and Facebook required to negotiate to pay Australian media outlets for the content they use.
If the parties cannot reach a commercial agreement, they will be forced into "final offer arbitration," also known as baseball negotiation, to reach an agreement.
But the Government's proposal is unlikely to become law this year and, in concessions to the tech giants, neither YouTube nor Instagram will be included and the companies will be given credit for the online traffic they provide to news organisations.
Public broadcasters ABC and SBS will also be included in the law despite being excluded initially.
Mr Frydenberg said the news bargaining code would be "world-leading reform" that would make a big difference to Australian media companies, from TV and radio broadcasters to newspapers and online outlets, who had taken a financial hit from an uneven playing field.
"This is comprehensive legislation that has gone further than any comparable jurisdiction in the world," he said.
"This is the product of three years of work, and it is a very significant development and it will ensure that or media landscape is more sustainable and more viable than otherwise would have been."
Mr Frydenberg said the ACCC's Digital Platforms report proved tech giants now dominated digital advertising spending by such a huge margin that Australian firms could no longer compete.
"As the market stands today, for every $100 of online advertising spend, $53 goes to Google, $28 goes to Facebook, and $19 goes to other participants," Mr Frydenberg said.
"And as a result of this concentrated market, these digital platforms were unavoidable trading partners for traditional news media businesses."
Mr Frydenberg confirmed digital outlets YouTube, Instagram and Twitter would not be included in Australia's news bargaining code, though the law would allow for the Treasurer to "designate" other services if an "unequal bargaining position" arose in future.
The draft law will be introduced to parliament tomorrow but, with only two sitting days left in the year, is unlikely to become law until 2021.
News Corp Australasia executive chairman Michael Miller welcomed the proposed news bargaining code and said it represented "a significant step forward in the decade-long campaign to achieve fairness in the relationship between Australian news media companies and the global tech giants".
"As a result of their lobbying, the tech platforms have won concessions and there should be nothing stopping them now from reaching fair commercial agreements," Mr Miller said.
"Ultimately, this code will benefit Australian consumers by helping sustain Australian news from Australian media companies."
But Peter Lewis, director of the Australia Institute's Centre for Responsible Technology, said the laws were desperately needed after "waves of closures and job cuts" at local news organisations during the COVID-19 pandemic, but warned Australians should brace for more vocal opposition from Facebook and Google.
"We know the big tech companies have been working hard to stop these changes and we can expect more threats over the summer," he said.
Federal Shadow Treasurer Jim Chalmers said Labor supported laws forcing Facebook and Google to pay for Australian journalism in principle but criticised the Government for delays in introducing its plan, and delivering another announcement without details.
"We are prepared to support in principle efforts to ensure that the playing field is levelled between the tech platforms and the news media organisations," he said.
"We do want to see quality journalism properly paid for in this country."
Shadow Communications Minister Michelle Rowland said she concerned about how Facebook and Google would respond to the forthcoming law as it "would be a detrimental thing for Australian consumers to lose" access to news content on the popular digital platforms.
Facebook and Google have been contacted for comment.
Originally published as 'World is watching': Tech giants to pay for news