Google, Facebook will face paying for news after Australian laws approved

Google and Facebook will almost certainly be forced to pay Australian media organisations for the news they use on their platforms after a Senate Committee yesterday endorsed the country’s proposed media bargaining laws as a way to “safeguard public interest journalism”.

The laws will be among the first in the world to demand the multibillion-dollar tech firms share revenue with news outlets, and are being closely watched by regulators in other countries, including Canada and the United States, where Microsoft encouraged the government to “copy” the approach.

The bill could be passed into law next week, starting a process that would see Facebook and Google negotiate with small and large Australian media companies later this year.

But it’s not clear how the tech giants will respond after months fierce campaigning against the laws and threats to withdraw services and remove news content from their platforms in Australia to evade the rules if they were passed.

The Senate’s final report into the News Media and Digital Platforms Mandatory Bargaining Code said while there were “some polarised views on the bill,” it had “significant support” and should be passed into law.

“While some submitters have questioned the methods and recommended additional refinements, there is a strong view that large multinational technology companies — in this case Google and Facebook — should not remain outside sensible regulations that protect the public interest,” the report found.

The Senate Committee, chaired by Western Australian Senator Slade Brockman, also noted the laws were “innovative” and reflected international concerns that “public interest journalism is a public benefit that is being undermined by the internet and that new legislative frameworks are required”.

“(The news code’s) provisions will provide the basis for a more equitable relationship between the media and Google or Facebook and, through this, help safeguard public interest journalism in Australia,” it reported.

The laws, first drafted by the Australian Competition and Consumer Commission, will establish rules for negotiations between digital platforms and registered Australian news businesses over sharing revenue from the use of their content.

The rules would affect Google’s Search and Facebook’s Newsfeed platforms, and would force the companies to seek agreements over payments, and into final-offer arbitration if they could not reach agreement within three months.

Digital platforms will also be asked not to discriminate against news outlets, develop ways to promote original news content, and give media businesses 14 days’ notice before major changes to the way their content would be shown online.

The Committee’s recommendations come 18 months after the competition watchdog first recommended voluntary codes of conduct, and 10 months after Federal Treasurer Josh Frydenberg announced the code would be mandatory after negotiations between the parties stalled.

Mr Frydenberg said yesterday he welcomed the Committee’s endorsement “which recommends no changes,” and would introduce the bill to Parliament next week.

Labor has offered “in-principle” support for the news code, with Shadow Communications Minister Michelle Rowland saying laws should be swiftly debated and passed to “end the uncertainty and level the playing field between the news media and digital platforms”.

It’s unclear how Google and Facebook will ultimately respond to the Senate’s endorsement of the laws, however, after both threatened to remove or change their services to evade them.

Google Australia managing director Mel Silva told the Senate inquiry the tech giant would have “no real choice but to stop making Google search available in Australia,” if the laws passed.

And the company’s public policy head Lucinda Longcroft refused to rule out the removal of other Google services such as Gmail, Maps, and YouTube when asked about them by the Senate Committee.

“At this stage, we are still understanding the implications of removing Search on our other services,” she wrote.

In a statement following the approval of the proposed laws, Ms Longcroft said Google would continue to seek “amendments” to the news code, including changes to the way it must negotiate with media outlets and recognition of Google’s own News Showcase project.

“We look forward to engaging with policymakers through the parliamentary process to address our concerns,” she said.

Facebook Australia managing director Will Easton also said the company would “stop allowing publishers and people in Australia from sharing local and international news on Facebook and Instagram” if the laws were enacted.

But rival Microsoft, which publicly offered to fill any vacancy left by Google, endorsed Australia’s news media bargaining code for a second time yesterday, with president Brad Smith saying the United States government should introduce similar laws.

“The United States should not object to a creative Australian proposal that strengthens democracy by requiring tech companies to support a free press. It should copy it instead,” Mr Smith said in a blog post.

Mr Smith said Australia’s proposed laws were a “creative answer” to an “economic imbalance between technology and journalism,” and said Google’s hurried video meeting with the Prime Minister after Microsoft offered support for the laws demonstrated its monopoly on the market.

“Within 24 hours, Google was on the phone with the Prime Minister, saying they didn’t really want to leave the country after all. And the link on Google’s search page with its threat to leave? It disappeared overnight,” he said.

“Apparently, competition does make a difference.”

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