US urged to drop media code dissent
The US government is being pressured to retract its objections to Australia’s news media bargaining code, amid accusations its public stance is a threat to high-quality journalism.
The US government’s trade office has been urged to retract its objections to the mandatory news media bargaining code in Australia, amid accusations that its public stance against the Morrison government’s legislation was a threat to high-quality journalism and stained America’s global reputation.
A fortnight ago, in the dying days of the Trump administration, the Office of the United States Trade Representative wrote a letter to Labor senator Alex Gallacher — who was chairing the forthcoming Senate hearing into the media code — to push for a voluntary code of conduct for the tech giants, rather than a mandatory one.
The note, with a presidential letterhead, states: “The United States respectfully requests Australia suspend plans to finalise this legislative proposal.
“Broad reform calling for government intervention in the markets is a significant step. While it may be appropriate to investigate large technology platforms for specific violations of the law — including the antitrust and consumer protection laws — such a sweeping regulatory change seems premature without further study and input.
“Australia should again consider promoting a voluntary code of conduct supported by, as appropriate, targeted regulations developed in an open and transparent process, allowing participation by all relevant stakeholders.”
But just 24 hours after the inauguration of President Joe Biden, the News Media Alliance — which represents more than 2000 publishers in the US, including The Wall Street Journal and The New York Times — began a campaign for a retraction of the letter that had been sent by members of the previous members of the Trade Office.
In a letter obtained by The Australian, the peak body tells Katherine Tai — who was last month appointed the new US Trade Representative by Mr Biden — that the intervention by the trade office just before her nomination was “inappropriate”.
“We believe such a request fails to represent wider US trade and business interests, undermines the sustainability of high-quality journalism back home and abroad, and threatens the reputation of the United States internationally,” reads the letter, signed by NMA president and chief executive David Chavern.
“Australia’s effort to establish a bargaining code for online platforms and news publishers comes at a time when news publishers around the world face an existential struggle to survive in a digital environment controlled by a few dominant platforms.
“As numerous studies, reports, and investigations have shown, these platforms impose unfair terms on news publishers and other actors in the online ecosystem and reap the majority of the benefits.
“Over the last fifteen years, the United States alone has witnessed the loss of more than a quarter of its newspapers, leaving thousands of communities as news deserts and leading to thousands of lost jobs. Demanding fair compensation for the use of news content online is vital in order to reverse this trend.
“These losses come as platforms are seeing enormous increases in their value – with Google’s market capitalisation exceeding $1.2 trillion dollars – value derived in part from its exploitation of news without payment.”
The letter from the NMA also calls out the monopolistic behaviour of the tech giants — an issue that is at the heart of the concerns of Australia’s media companies.
“Broadly accepted competition principles suggest that monopsonists be regulated to ensure that consumers are protected, and the Australian proposal is a logical way to deal with failures of the marketplace,” it reads.
“There has never been a more critical role for a free press supported by a solid economic foundation. Acknowledging the need for the USTR to balance the views and interests of different US industries, we therefore urge you to retract the recent outreach to Australia and refrain from taking positions that benefit one sector of the US economy at the expense of others and undermine an important pillar of democracy.”
The Morrison government’s world-first media bargaining legislation would force the tech giants to compensate publishers for the value of their news content that is used by the digital platforms.
The legislation currently has broad support across Australia’s political spectrum, including “in-principle” support from Labor, and it could be passed by the Senate as early as this month.
In response to the first letter from the US Trade Office on January 18, Treasurer Josh Frydenberg said the Morrison government was “committed to proceeding with a mandatory code that is fit for purpose and which will achieve its intended objectives of addressing the bargaining power imbalances with digital platforms and media companies.”
On Sunday, Mr Frydenberg revealed that he had been contacted by Facebook founder Mark Zuckerberg last week over the news media bargaining code.
While the conversation was amicable, the Treasurer said he told Mr Zuckerberg that the Morrison government was committed to implementing the media code in its current form.
“Mark Zuckerberg didn’t convince me to back down, if that’s what you are asking,” Mr Frydenberg said.
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