Google and Facebook to pay for Australian news under new ACCC code

Andrew Cummings
August 3, 2020

"It's about ensuring that we have increased competition, increased consumer protection, and a sustainable media landscape", Frydenberg told reporters in Melbourne.

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

While Australia envisages the code will eventually apply to any digital platform using Australian news content, Frydenberg said it would initially focus on Facebook and Google, two of the world's richest and most powerful companies.

In addition, the platforms must give news media businesses clear information about the data they collect through users' interactions with news on digital platforms; for example how long users spend on an article, how many articles they consume in a certain time period, and other information about user engagement with news content across digital platform services. But talks over payment stalled and the government then asked the regulator to develop a mandatory code.

A final round of consultation on the draft mandatory code will take place in August, with the code expected to be finalised shortly afterwards.

The decision comes as the tech giants fend off calls around the world for greater regulation, and a day after Google and Facebook took a battering for alleged abuse of market power from USA lawmakers in a congressional hearing.

According to the proposed legislation, digital platforms will carry out negotiations with media companies for extracting content from them.

Digital platforms would be required to give news media businesses 28 days' notice of algorithm changes likely to materially affect referral traffic to news, algorithm changes created to affect ranking of news behind paywalls, and substantial changes to the display and presentation of news, and advertising directly associated with news.

"The government's heavy-handed intervention threatens to impede Australia's digital economy and impacts the services we can deliver to Australians", said Mel Silva, Google's managing director for Australia and New Zealand.

This move to help journalism is part of a bigger initiative by the Australian government.

"We want Google and Facebook to continue to provide. services to the Australian community", said Frydenberg, the Australian treasurer.

The code requires "advance notice of at least 28 days of algorithm changes affecting news ranking, the display of news content and advertising with news content", Frydenberg said.

Both Facebook and Google say advertising revenue linked to news content is a small fraction of their overall revenue.

It was a "watershed moment" in efforts to end "free-riding" by the tech companies, News Corp Australia executive chairman Michael Miller said on Friday.

It will include "substantial penalties" that could cost the tech companies hundreds of millions of dollars, he said.

In December past year, the Government responded to the ACCC's report with a program of work including a voluntary code of conduct for negotiation around content between traditional news media organisations and the digital platforms.

"Nothing less than the future of the Australian media landscape is at stake with these changes".

"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", he said.

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