SYDNEY • The so-called media bargaining code has been designed by the Australian government and competition regulator to address a power imbalance between social media giants and publishers when negotiating payment for news content used on the technology companies' sites.
Under the code, news outlets must negotiate deals individually or collectively with Facebook and Google. If they cannot reach an agreement, an arbitrator will decide whose offer is more reasonable.
If Facebook or Google breaks any resulting agreements, it can be fined up to A$10 million (S$10.3 million) in civil penalties. The law also requires tech companies to give media outlets notice when they change search algorithms in a way affecting the order in which content appears.
They must also share their use of consumer data extracted from news content on their sites. The proposed code will apply to Facebook and Google, although the regulator, which advised the government on the legislation, has said it is likely that other tech companies will be added.
1. HOW IS AUSTRALIA'S APPROACH DIFFERENT FROM LEGISLATION ELSEWHERE?
Australia has used the competition law to draft the media bargaining code, an approach the country's regulator has argued is much more effective than the copyright legislation being used in other jurisdictions, including the European Union.
The difference between the two has been highlighted by the recent deals struck with Google by Australian publishers and by outlets in France, which is the first EU country to bring an EU directive on copyright into national law.
Australia's two largest free-to-air television broadcasters have struck deals collectively worth A$60 million a year, according to media reports. That dwarfs the US$76 million (S$101 million) Google will split between 121 publishers in France over three years.
2. WHY HAS THE DISPUTE ESCALATED?
The proposed legislation has reached a crunch point, with widespread support in Australia's Parliament, where it is expected to be voted into law within days. In recent years, traditional media companies operating in Australia have suffered huge hits to income streams, due to dwindling subscriptions and advertising.
For every A$100 spent on online advertising in Australia, excluding classifieds, nearly one-third goes to Google and Facebook, the competition regulator has said. Facebook's decision to block users from sharing and viewing news content was condemned by Australia's political leaders yesterday, after many of the country's official health and disaster management alerts were also erased from news feeds.
Facebook said the law did not provide clear guidance on the definition of news content, although it said it would restore content that was inadvertently affected.
3. WHAT HAS THE RESPONSE BEEN?
Facebook said that the law "fundamentally misunderstands" the relationship between itself and publishers, and it faced a stark choice of attempting to comply with it or ban news content. It said its platform generates billions of free referrals to Australian publishers worth significant sums to the media companies.
Alphabet-owned Google, however, has backed down from a threat to withdraw its main search engine from Australia if the laws go ahead, and has instead struck deals with some of the country's major commercial publishers. They include a global deal with News Corp for an unnamed sum in one of the most extensive deals of its kind with Big Tech.
REUTERS
