Microsoft urges US to copy Australia’s media code

Microsoft wants the US to follow Australia’s lead and make tech giants pay for news, further putting it at odds with Google and Facebook.

Microsoft president Brad Smith has lauded Australia’s “innovative” media code.

Microsoft president Brad Smith has called on the US to follow Australia’s lead and develop a mandatory news media bargaining code of its own, just days before the Senate is expected to vote in favour of the Morrison government’s proposed legislation to rein in the market power of the big tech companies.

“Australia’s proposal will reduce the bargaining imbalance that currently favours tech gatekeepers and will help increase opportunities for independent journalism,” Mr Smith wrote in a lengthy blog entry, posted on Friday morning (AEDT).

“This a defining issue of our time, going to the heart of our democratic freedoms.

“The United States should not object to a creative Australian proposal that strengthens democracy by requiring tech companies to support a free press. It should copy it instead.”

Mr Smith’s remarks follow his dramatic intervention last week in the Australian debate over the unregulated power of digital platforms, when he told local media that if Google was to make good on its threat to remove its search engine facility from Australia if the media code becomes law, then Microsoft’s Bing search engine would fill the void and willingly adhere to a news media code.

In his blog entry, titled “Why an Australian Proposal Offers Part of What’s Needed for Technology, Journalism, and American Democracy Itself”, Mr Smith said the US was beset by a “disinformation barrage” — largely due to the rise of the internet and social media — and noted that “independent journalism is vital to the social cohesion that is essential for democracy”.

“The cure will likely require multiple medicines. But part of an innovative prescription has emerged from halfway around the world. In Australia, Prime Minister Scott Morrison is pushing forward with legislation two years in the making to redress the competitive imbalance between the tech sector and an independent press,” Mr Smith said.

“The ideas are straightforward. Dominant tech properties like Facebook and Google will need to invest in transparency, explaining how they display news content and providing advance notice of algorithmic or advertising changes that are likely to have a significant effect on their sites’ referral traffic to news content.

“Even more important, the legislation will redress the economic imbalance between technology and journalism by mandating negotiations between these tech gatekeepers and independent news organisations. The goal is to provide the news organisations with compensation for the benefit the tech gatekeepers are deriving from the inclusion of news content on their platforms.

“It’s an idea that some governments have pursued in parts of Europe, but with only limited success. The reason is that it’s hard to negotiate with a monopolist. With only one or two whales on one side of a nation’s table and dozens or hundreds of minnows on the other, the result is often a lengthy and expensive negotiation that leaves the minnows short on food.

“But the Australians thought about this, and they developed a creative answer.”

Mr Smith’s remarks were posted just hours before a Senate report into Australia’s news media bargaining code is due to be tabled in parliament.

That report follows two days of hearings earlier this month before a Senate committee, which assessed the merits of the legislation and took presentations from representatives of the big tech companies, as well as media organisations (including News Corp Australia, publisher of The Australian.

The Senate could vote on the legislation as early as Tuesday.