Google and Facebook will be forced to pay for news content in Australia
Australia’s competition watchdog says Google and Facebook are “making a lot of money” from Australian media companies and should be contributing to the cost of producing journalism.
NSW
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Australia’s competition watchdog says a world-first mandatory code forcing tech giants to pay for local journalism will end the “one sided” business model threatening the country’s “way of life”.
Australian Competition and Consumer Commission chair Rod Sims said Google and Facebook were “making a lot of money” from Australian media companies and should be contributing to the cost of producing journalism.
“Google and the Facebook business model is to give people free services and use their data to target ads at their users,” he told ABC.
“The problem with that is that some of that information they are providing consumers for free has come from people who have invested a lot of money in journalism in the case of media to provide that content.”
Mr Sims said the “ultimate goal” of the new code was to have a fair sharing of the value created by Australian media companies so the industry could be sustainable.
“Having sustainable media businesses is fundamental to our democracy and our way of life,” he said.
“There is a lot at stake here and it is very important that we get it right.”
WHY THERE ISN’T A CODE ALREADY
Mr Sims said “good progress” had been made with aspects of the voluntary codes being developed, but it was unlikely any agreements would have been reached.
“There was concern from some of the media companies that it was really being completely driven by Facebook and Google,” he said.
“The Government asked us about a week ago … to give them our best view about how it was going to unfold.
“We provided the view that while there could well be progress on a number of matters, the essential issue of value-sharing or pay for content seemed unlikely that there would be agreement on that.”
Mr Sims said the voluntary codes had failed overseas.
“A couple of countries overseas, particularly Spain and France, have passed various laws to get Google and Facebook to pay for content and Google and Facebook have basically said the amount we’re willing to pay is zero,” he said.
“There is that track record.”
Mr Sims said the code would specify a “whole range of issues” to govern the relationship between media businesses and digital platforms.
“It would start defining what is media, what is news?
“It will go through to talking about things like what access to data there is, how do you prioritise news in the feeds and also this crucial issue of value-sharing.
“Then that would be an enforceable code which for various parties, they would have to comply with that.”
HOW WILL IT WORK?
Mr Sims said there were a number of ways to get digital platforms to pay for journalism, such as a cost per click or a payment based on the cost of the reporting.
“Those details have to be worked out but while they are complex, I think they can be worked out.” he said.
Mr Sims said he believed Australia would be successful where other countries had failed because the code would apply far wider.
“In Spain, for example, it was simply based around Google news, not Google search,” he said.
“I think it is a matter of making this broad enough so that it covers the entirety of the relationship and really both parties need each other.
“The platforms need the news business, the media companies need the platforms.
“Given that understanding, there has to be an arrangement that will just move the dial a bit to share that value in a better way than it is being shared at the moment.”
Mr Sims said the ACCC would hand a draft of the code to the federal government to be made public by the end of July 2020.
In a statement, Google said it had “sought to work constructively” with the ACCC, the media industry and the government.
“We will continue to do so in the revised process set out by the government today,” a spokeswoman said.
“We’ve worked for many years to be a collaborative partner to the news industry, helping them grow their businesses through ads and subscription services and increase audiences by driving valuable traffic.”
“Since February, we have engaged with more than 25 Australian publishers to get their input on a voluntary code and worked to the timetable and process set out by the ACCC.”
FRYDENBERG SAYS WE WON’T BE ‘BULLIED’
Treasurer Josh Frydenberg says Australia will not be bullied into a bad deal by tech giants trying to avoid paying media companies for news content.
“We won’t bow to their threats,” he said.
“In France, the digital platform said that they wouldn’t show domestic media unless it was for free.
“The domestic media companies all said this was a misuse of market power, for which now the French regulator is investigating.”
Mr Frydenberg said the federal government understood the “challenge” they faced in seeking a mandatory code requiring Facebook and Google to pay for the content they use to sell ads online.
“This is a big mountain to climb,” he said.
“These are big companies that we are dealing with but there is also so much at stake, so we’re prepared for this fight.”
ALP THROWS SUPPORT BEHIND CODE
The opposition has backed a mandatory code requiring tech giants to pay for journalism content but says it was “disappointing” it took the COVID19 pandemic for the move to be fast tracked.
Labor’s communications spokeswoman Michelle Rowland said it was “appropriate” the ACCC oversee the development of the code as an independent body.
“Australians need and deserve a strong, independent media landscape,” she said.
“Labor welcomes the announcement that the ACCC will move to impose a mandatory code of conduct to govern commercial dealings between digital platforms and news media companies.”
Ms Rowland said Australian media was already “doing it tough” before the coronavirus outbreak.
“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.
“Australian media companies must get a decent return for their investment in public interest journalism from digital platforms such as Google and Facebook.”
Ms Rowland said the federal government still had much to do on its “media reform to do list”.
“Public interest journalism and Australians’ right to know has never been under more pressure both commercially and from attacks by this Morrison Government obsessed with secrecy,” she said.
FIGHT AGAINST ‘RIPPING OFF STORIES’
The government’s world-first mandatory code for tech companies is an “extraordinarily important milestone” in the fight back against the tech titan monopolies, according to Daily Telegraph Editor Ben English.
The federal government is seeking to charge tech companies fees for the siphoning of news content onto its platforms.
“The only way these guys are brought to the table is kicking and screaming with the threat of regulation hanging over their heads – which to them, is kryptonite,” Mr English said.
“They have traded on the false notion they’re not even publishers. We know that is patently untrue.
“In fact, billions and billions of dollars have been generated into their coffers by virtue of them publishing – for free – news content which in many cases has taken days, weeks and months to accumulate.”
Mr English said of the key problems in the 21st Century media landscape is the process by which traditional media outlets – or “originators” who possess “journalism-generated” stories, have their content taken by aggregators which in turn are rewarded by Google and Facebook for “ripping off stories”.
“As a result, there’s no value coming back to the originators of the content,” he said.
Online giants Google and Facebook will be forced to pay for news in Australia in a world first move to breathe fresh life into quality local journalism.
FREE RIDE HURTING LOCAL COMMUNITIES
The federal government has told the Australian Competition and Consumer Commission to develop a mandatory code covering commercial dealings between the tech titans and media companies.
The decision comes after the ACCC provided a progress report last Tuesday on the negotiations of voluntary codes, advising it was “highly unlikely” there would be agreements on payment for content.
Following a landmark 19-month investigation, the ACCC found last year Google and Facebook had become unavoidable trading partners for Australian news media businesses in reaching audiences online but were hoovering up more than $5 billion a year in advertising revenue.
Analysis by the competition watchdog revealed a “significant reduction” in journalism.
At least a quarter of written journalism jobs had disappeared since 2008, as had more than 100 local and regional mastheads, leaving 21 local government areas without a single newspaper.
Coverage of councils was down 26 per cent while there had been a 40 per cent fall in reports from courts as well as science and health news.
Treasurer Josh Frydenberg wanted a progress report on a voluntary code on media payments in May and implementation in November with a mandatory code introduced if terms couldn’t be reached.
However, the government has decided to speed up its original timetable — due both to the ACCC’s bleak assessment of the chances of a mutual agreement on payment for content, and a sharp decline in media companies’ advertising revenues caused by the coronavirus crisis.
Efforts to facilitate voluntary codes between individual media companies and each of Facebook and Google will now cease and, instead, the ACCC will draft mandatory rules by the end of July. Australia will be the first country to produce such a framework.
“It’s only fair that those that generate content get paid for it,” Mr Frydenberg said. “This will help to create a level playing field.”
The giants will face financial penalties for breaches.
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.
“The decisive move by the government to go directly to a mandatory code of conduct between the international tech giants and Australian news media companies is a vital step that can help secure the future of Australian journalism.”
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