Australia Makes Google & Facebook Pay

The Australian government has now passed into law regulations that require Google and Facebook to negotiate with news outlets to pay for their content or face arbitration.  Australia will be the first country where the government decide the price to be paid by tech giants if commercial negotiations with local news outlets fail to work.

Recently, Facebook had blocked all news content to Australians then changed their position after negotiations with the government. Google will now pay for news content that appears on its Showcase product and Facebook is expected to pay providers who appear on its News product, which is to be rolled out in Australia later this year.

Australia's law has been seen as a possible test case for similar regulation in other countries to get payment from digital platforms for news. “The code will ensure that news media businesses are fairly remunerated for the content they generate, helping to sustain public-interest journalism in Australia,” Treasurer Josh Frydenberg and Communications Minister Paul Fletcher said in a joint statement. The rules will be reviewed after a year.

Facebook and Google argued it "fundamentally" misunderstands how the internet works. The technology firms contend that they already help news publishers by driving traffic back to news sites from their platforms - Facebook and Google simply help people find news content in the first place, the platforms say.

Both  companies lobbied the Australian government to amend the law, while also pursuing contracts with local news companies. 

Google had threatened to withdraw its primary search engine from Australia, but the company recently agreed deals with local media companies including Nine Entertainment and Seven West Media worth an estimated A$60m ($47m; £34m) in total. 
It has also signed a deal for an undisclosed sum with Rupert Murdoch's News Corporation.

Facebook promised to reverse its ban on news content, though Australian news pages remain unavailable. It has since signed at least one deal  and is in talks other Australian news groups.

The News Media Bargaining Code requires Facebook and Google to pay a negotiated fee to link to or use news content, and includes a mandatory arbitration process if an agreement on fees can’t be reached. It also asks tech companies to give advance notice to news organizations about upcoming algorithm changes.

It’s the threat of arbitration that both Google and Facebook had hoped to avoid, a process whereby an independent body decides the value of news content in news feeds and search results.

Both firms have also committed to spending $1bn each in the news industry globally over the next three years. Google has struck a series of deals with publishers, including a global content arrangement with News Corp, after earlier threatening to withdraw its search engine from Australia over the laws.Several media companies, including Seven West Media , Nine Entertainment and the Australian Broadcasting Corp have said they are in talks with Facebook.

Thousands of journalism jobs and dozens of news outlets have been lost in Australia alone over the past decade as advertising revenue went digital. For every $100 spent by Australian advertisers today, $49 goes to Google and $24 to Facebook, according to the country’s competition watchdog.

ACCC:       Euronews:      The Verge:     BBC:       Irish Times:      AlJazeera:    Image: Unsplash

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