Credibility key as negotiators walk a fine technical line

Google announced deals with several Australian media companies this week. Picture: AFP

The federal government’s media bargaining code has worked well with Google but not Facebook and efforts to bring one into line risk losing the other.

This means any tweaks to the legislation must be “technical” or the government’s credibility will be shot to pieces.

When ACCC boss Rod Sims gives his guide to his year-ahead priorities at a CEDA lunch in Sydney this week, the platforms will be top of the list.

From Sims’ perspective, the tech journey is a learning curve in which he is taking one issue at a time.

First was the media code.

Next is adtech, with a final report due in August that will be to attack the Google dominance in digital advertising.

Next up is digital apps, which brings Apple into play and its walled garden charging people to include their apps on its phone.

The premise behind the media code was that the platforms needed news to support their advertising businesses and should pay for it.

Google has provided plenty of credence to this argument but Facebook has simply argued it doesn’t need news.

This is the same company that has negotiated for the past two years with international media groups to join its “news service” that provides headlines and summaries.

Facebook is also facing US action to strip it of recent acquisitions like WhatsApp on antitrust grounds, which threaten its market power.

Former ACCC boss Allan Fels has suggested an unconscionable conduct case, which has merit but would be tough to prove if the company doesn’t want to be in the news business. The consequences should be commercial, with its network and advertising powers diminished as its users seek alternate ways to get their news.

Just what is news is an argument but one purely semantic to potentially let Facebook off the hook.