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Govt moves to force digital giants to pay for news

Media and marketing

Google and Facebook will be forced to pay for Australian news content under a landmark plan to level the playing field for ailing media outlets.


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Treasurer Josh Frydenberg on Monday announced a mandatory code on digital platforms to be finalised in July, four months earlier than planned.

It comes after coronavirus triggered a collapse in advertising revenue leading to regional outlets shutting and scaling back operations.

“You clearly can’t save all papers and all jobs,” Frydenberg said.

“We’re not seeking to protect traditional media businesses from the rigour of competition or the rigours of technology, what we’re seeking to do here is ensure a level playing field.”

Facebook and Google have a stranglehold over the digital advertising market and benefit greatly from the content of news publishers on their platforms.

For every $100 of online advertising excluding classifieds, $47 goes to Google, $24 to Facebook and $29 to other players.

“What we’ve seen with the rise of the digital platforms is many consumer benefits but also a large disruption,” Frydenberg said.

Talks over a voluntary code between the ACCC and the digital giants broke down, prompting the government to look at making it mandatory.

Labor’s communications spokeswoman Michelle Rowland had been calling for the mandatory code to be fast tracked.

“It is disappointing that it has taken a global pandemic for this government to find a sense of urgency about the state of Australia’s news media,” she said.

The new code will include enforcement, penalties and ways to deal with disagreements between the global platforms and local media companies.

While Spain and France have made failed attempts to make the companies pay up, Frydenberg believes Australia can succeed.

Prices for content or the nature of commercial agreements would need to be negotiated but remedies would be in place forcing tech companies to comply.

News Corp Australia executive chairman Michael Miller said Google and Facebook had built trillion-dollar businesses by using other people’s content and refusing to pay for it.

Nine chief executive Hugh Marks also welcomed the move.

News Corp and Nine have cited the impact of digital platforms on their bottom lines as part of their move to close down Australian Associated Press, the 85-year-old national newswire.

The Media Entertainment and Arts Alliance welcomed the move, saying it would help provide a sustainable future for Australian journalism.

“The government has realised that voluntary codes don’t work when there is a bargaining power imbalance. Google and Facebook have in part grown off the back of news content,” MEAA federal president Marcus Strom said.

“The creators of that content, news media outlets, have suffered while still producing vital public interest journalism. Google and Facebook will now be required to negotiate responsibly with news media and start paying for the content they have exploited for free.

“MEAA supports the development of a mandatory code and we will scrutinise the draft legislation carefully. MEAA intends to monitor the distribution of the funds which we believe should support emerging and future journalism, not just existing media outlets.”

-with AAP

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