A draft mandatory code from the Australian Competition & Consumer Commission aims to enable local media to bargain with Google and Facebook to receive fair payment for their news content.
“There is a fundamental bargaining power imbalance between news media businesses and the major digital platforms, partly because news businesses have no option but to deal with the platforms, and have had little ability to negotiate over payment for their content or other issues,” ACCC Chair Rod Sims said.
“We wanted a model that would address this bargaining power imbalance and result in fair payment for content, which avoided unproductive and drawn-out negotiations, and wouldn’t reduce the availability of Australian news on Google and Facebook. We believe our proposed draft code achieves these purposes.”
The draft code proposes that if the news businesses and the digital platforms cannot strike a deal through a formal three month negotiation and mediation process, then an independent arbitrator would choose which of the two parties’ final offer is the most reasonable within 45 business days.
The draft code would also allow groups of media businesses to collectively negotiate with the platforms. This could include, for example, regional and community mastheads.
The code is about more than just payment issues, however. It also requires digital platforms to give news media businesses 28 days’ notice of algorithm changes likely to materially affect referral traffic to news, algorithm changes designed to affect ranking of news behind paywalls, and substantial changes to the display and presentation of news, and advertising directly associated with news.
In addition, the platforms would have to give news media businesses clear information about the data they collect through users’ interactions with news on digital platforms; for example how long users spend on an article, how many articles they consume in a certain time period, and other information about user engagement with news content across digital platform services.
Inevitably, the tech giants are less than impressed, with Mel Silva, managing director at Google Australia and New Zealand, describing the intervention as “heavy handed” and suggesting it could affect the country’s digital economy and the services Google offers.
"It sets up a perverse disincentive to innovate in the media sector and does nothing to solve the fundamental challenges of creating a business model fit for the digital age,” she said.
Sourced from ACCC, Ad News; additional content by WARC staff