Social media giant Facebook has added its voice in opposition to the proposed NMBC, saying it would have to prioritise other markets and stop hosting news in Australia; Google, meanwhile, has said it would need to pull out of the Australian search market.
Why it matters: Termed blackmail by one senator, the escalation of now both companies’ opposition to a law that would vastly strengthen the position of news media companies against platforms, is a significant new step.
Facebook: In a blog post, Facebook’s managing director for Australia, Will Easton, said that given the possibility of the law, it was already prioritising other countries for investment until it understood the impact. “There’s no other law like this in Australia,” he wrote. “No other business is forced into a highly uncertain binding arbitration process where the government decides who enters these agreements and forces payment from the provider of a free service.”
Google: The search giant’s ultimatum was perhaps more serious. Speaking in an Australian Senate hearing on Friday, Google Australia’s Managing Director, Mel Silva, called the proposals “unworkable,” adding: “If the code becomes law, Google would have no real choice but to stop providing search in Australia.”
It follows news earlier this month that Google had begun experimenting how search might look in the country without commercial news, in a move widely seen to demonstrate the company’s market power.
What is the law? Designed to correct what the Australian Competition & Consumer Commission regards as “acute power imbalances,” the NMBC would allow news organisations to bargain collectively with the platforms, rather than on the title-by-title negotiations that happen now.
If they are unsuccessful in their negotiations within three months, they will be able to request arbitration to determine how much Google or Facebook must pay. Platforms must also notify publishers of algorithmic changes ahead of time and could face fines for not abiding.
Bottom line: The ultimatums, such as they stand, reflect the importance of the platforms, especially Google. Though Facebook would be a strange place without links, a social network could continue to function. Google, meanwhile, shows itself not only to be massively powerful, but tantamount to a utility.
Oddly, the talk – broadly perceived as threats – from the platforms comes during a week that Google agreed to pay French publishers for news, and struck a global deal with Reuters. While Facebook agreed a deal in December with a handful of UK newspapers.
A compelling read comes from the New York Times, which suggests that the companies' concern is less about payment, and more about having to pay publishers on terms other than their own.
The draft law is by no means perfect and has drawn criticism from internet titans like its inventor, Sir Tim Berners-Lee, who argues that as it stands the law could set a dangerous precedent over payments for linking, links being the basis of an open internet.
It’s an important argument, given that Google and Facebook (with its coming News product) don’t simply link and provide traffic to news publishers; they slightly repackage or reframe the news in order to add a richer experience. It’s this experience that they advertise against.
Sourced from FT, WARC, CNN, The Guardian, New York Times, The Conversation