Australia’s News Media Bargaining code hints at global model

Australia’s competition regulator has effectively declared victory in the three-year row with Google and Facebook over whether Big Tech should pay publishers for posting their news content.

The internet giants have agreed to the country’s pioneering news media bargaining code, and struck agreements with publishers that could mean them paying around A$200 million a year, the Financial Times reports.

Central to the new law is that it combines initial negotiation with follow-up arbitration if talks fail.

Why it matters

Traditional publishers have hemorrhaged revenue as tech giants attract the overwhelming majority of digital advertising. Governments elsewhere have come under pressure to take action over the use of traditional publishers’ news content without payment. A number of legislators in the US, UK and Canada have suggested a scheme similar to Australia’s bargaining code.

The details

• Google and Facebook initially strongly resisted the legislation, with Facebook at one point closing down its services in Australia for several days. 
• The legislation allows the Australian government to decide that a digital platform comes under the news media bargaining code, which means it is required to negotiate with news publishers over revenue, and if this fails, final-offer arbitration can be called for, with platforms facing tough penalties for non-compliance.
• Australia’s Nine Entertainment – owners of the Sydney Morning Herald – has already signed a multi-year contract with Google and Facebook; other major groups including News Corp, Seven West Media and the state broadcaster, ABC, have also signed deals or said to be close to doing so.

Key quote

“It’s actually very light-handed regulation in the sense that with the negotiate/arbitrate

model we just want the bargaining power to be equal. Prior to the code, deals weren’t getting done because Google and Facebook were dealing with people on a take it or leave it basis. With the code legislated deals are now getting done” – Rod Sims, chair of the Australian Competition and Consumer Commission

Sourced from the Financial Times