Australian publishers respond to draft mandatory code

Technology giants Google and Facebook will be required to negotiate with Australian media companies over payment for news content

In a statement published on its website this morning, the ACCC (Australian Competition and Consumer Commission) stated that the code is necessary to address "acute bargaining power imbalances between Australian news businesses and Google and Facebook".

This is to curb the power of the tech giants.

Google says it is "disappointed" by the policy.

Media mogul Rupert Murdoch's News Corp is reported to have lobbied hard for the Australian government to force the two United States tech giants to the negotiating table.

In addition to payment for content, the code covers issues like access to user data, transparency of algorithms and ranking of content in the platforms' news feeds and search results.

A public-comment period on the proposed rules runs until August 28 and final legislation would be introduced in Parliament soon after that. The government has released a draft mandatory code of conduct that aims to succeed where other countries, including France and Spain, had failed in making the digital giants Google and Facebook pay for the news siphoned from commercial media companies.

Campaign Asia-Pacific has reached out to Google and Facebook for further comment.

Friday's proposal "sends a concerning message to businesses and investors that the Australian government will intervene instead of letting the market work, and undermines Australia's ambition to become a leading digital economy", said Mel Silva, managing director for Google Australia & New Zealand.

"We are reviewing the government's proposal to understand the impact it will have on the industry, our services and our investment in the news ecosystem in Australia", said Will Easton, Facebook's local manager.

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The initiative has been closely watched around the globe because news media have suffered as tech giants like Facebook and Google hoover up the advertising revenue that once helped support them.

The news industry crisis has been exacerbated by the economic collapse caused by the coronavirus pandemic, with dozens of Australian newspapers closed and hundreds of journalists sacked in recent months.

The move has been strongly pushed by Australia's two biggest media companies, Rupert Murdoch's News Corp and Nine Entertainment, who stand to gain the most from the crackdown.

It was a "watershed moment" in efforts to end "free-riding" by the tech companies, News Corp Australia executive chairman Michael Miller said on Friday.

Facebook has argued that the move is discriminatory, while Google has asserted that the value of news to Google is actually very small and that media outlets derive more benefit from the search giant than the other way around.

"It's about a fair go for Australian news media businesses", Frydenberg told reporters in Melbourne, according to Reuters.

Thus, if Facebook or Google want to display a news story that is the property of an Australian media outlet, the companies would have to "buy" the news from them. We want it to be in accordance with our law. "We believe that our final-offer arbitration proposal provides a compelling incentive for parties to put forward fair and reasonable proposals, given each has just one chance to make an offer, and only one offer can prevail", he said.

The new rules, which need to be passed by Australia's Parliament, would require digital platforms to take part in negotiations with media companies over payment, Australia's competition regulator said Friday. If the concerned parties can not find common ground in three months, then an independent arbitrator would take the final binding decision.

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