Facebook, Google to pay ‘trillions’ back to news outlets

 

Digital giants Google and Facebook will be forced to pay for news content generated by the Australian media in a lifeline for the struggling industry.

Treasurer Josh Frydenberg and Communications Minister Paul Fletcher will announce today a mandatory code of conduct on digital platforms to be finalised by July, bringing forward a November deadline.

Failure to comply could result in sanctions from Australia's consumer watchdog for Facebook and Google.

The decision to fast-track the code follows a collapse in advertising revenue due to the COVID-19 pandemic, which has led to many newsrooms, especially in regional areas, closing or scaling back their operations.

 

Facebook and Google have a stranglehold over the digital advertising market and benefit greatly from the content of news publishers on their platforms, social media, search queries and digital video.

News Corp and Nine have cited the impact of digital platforms on their bottom lines as part of their move to close down AAP, the national news wire.

"For two decades, Google and Facebook have built trillion dollar businesses by using other people's content and refusing to pay for it," News Corp Australia executive chairman Michael Miller announced.

"Their massive failure to recognise and remunerate creators and copyright owners has put at risk the original reporting that keeps communities informed."

Both the Media, Entertainment and Arts Alliance and News Corp have called for the Morrison Government to correct this "power imbalance".

 

Facebook has to conform to the new rules to be announced today or face sanctions.
Facebook has to conform to the new rules to be announced today or face sanctions.

 

The Australian Competition and Consumer Commission (ACCC) last December handed down its report after an inquiry into Facebook, Google and the impact other internet giants are having on the media industry.

The ACCC was negotiating with big tech and media companies on a voluntary code of conduct that would have been made mandatory in November if no agreement was made before then.

This recommendation to have a code of conduct was one of 23 made by the Australian Competition and Consumer Commission after an 18-month investigation into tech giants.

The Australian consumer watchdog will come up with a way to enforce, penalise and mediate between the global platforms and local media companies.

"The groundbreaking report prepared by the ACCC into digital platforms was world-leading and now paves the way for a mandatory code of conduct requiring payment for content," Mr Frydenberg said.

"This will help to create a level playing field."

Google is also set to pay up.
Google is also set to pay up.

 

Mr Miller welcomed the move, calling it a "vital step for Australian journalism".

"The Australia media industry is at a tipping point and a mandatory code that leads to the platforms paying a fair - and very significant price - must be put in place urgently," he said.

"It is essential the mandatory code corrects the power imbalance between the tech platforms and local news media companies and sets rules that lead to the platforms finally paying for the news content they take and profit from.

"The platforms have had many years to act fairly and have chosen not to, and steps like the one now taken by the Australian Government are now finally necessary.

"The rush of audiences back to trusted news sources during the COVID-19 crisis has been a powerful reminder that real journalism must not be destroyed by companies that take it for their own use and refuse to pay.

"I look forward to working through the process to get this code of conduct in place for the start of the next financial year so it can make a material contribution to the future of our industry."

Originally published as Australia forces Google, Facebook to pay up


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