Digital giants Google and Facebook will be forced to compensate Australian news outlets for their content under a mandatory code of conduct to be developed by the Australian Competition and Consumer Commission (ACCC).
Federal Treasurer Josh Frydenberg told ABC Radio’s AM this morning that the objective behind the mandatory code of conduct is to ensure a level playing field.
“We’re not seeking to protect traditional media businesses from the rigour of competition or the rigours of new technology.
“The idea is that they (Facebook and Google) pay for content. They use the journalistic material that is produced to get traffic onto their websites, that’s how their business operates, and then they sell advertising.
“For every $100 of online advertising spent in Australia excluding classifieds, $47 goes to Google, $24 to Facebook, and $29 to other players, so they’ve completely dominated the space,” Mr Frydenberg said.
The development of a code of conduct is part of the Australian Government’s response to the ACCC’s Digital Platforms Inquiry final report to promote competition, enhance consumer protection and support a sustainable Australian media landscape in the digital age.
In its final report, the ACCC identified that Facebook and Google have each become unavoidable trading partners for Australian news media businesses in reaching audiences online, resulting in an imbalance in bargaining power.
“That’s brought into focus and into question the viability of our traditional media outlets and the inability of the current regulatory framework to ensure that journalistic content is properly compensated,” Mr Frydenberg.
In December last year, the ACCC was directed by the Government to facilitate the development of voluntary codes to address bargaining power imbalances between digital platforms and news media businesses.
The Government indicated at the time that if an agreement was not forthcoming, alternative options would be developed to address concerns raised, which may include the creation of a mandatory code.
“We went down the path of a voluntary code between the digital platforms and the traditional news businesses, that didn’t bear much fruit, so now we’ve moved to a mandatory code,” Mr Frydenberg said.
In 2014 Spain introduced a mandatory ‘snippet tax’ that attempted to charge Google for links in an aim to compensate news publishers.
The Google News service was subsequently shut down briefly to Spanish consumers in protest.
In 2019 the European Union debated introducing rules that would require Google News to pay for publishing short excerpts from articles.
The Search Engine responded by threatening to pull their news service from the continent completely.
The Australian Government since decided that the original timeframe set out in its response, which would have seen a code developed by November, requires acceleration.
A draft mandatory code will be released for consultation by the ACCC before the end of July, with a final code to be settled soon thereafter.
Code risks proliferating fake news
Responsible Technology Australia executive director Chris Cooper warned that forcing the likes of Facebook to pay for authentic news risked further driving the popularity and proliferation of fake news.
“Australian publishers absolutely should be getting a fairer cut of the news they create that keeps users glued to digital platforms.
“However, while we know that authentic news engages users online, the other content we know has a similar effect is fake news.
“”During this pandemic, for example, Australians have been soaked by Facebook and Google in fake news,” he said.
Mr Cooper called for the code to include measures to force Facebook and Google to share real data about what fake news is going viral on their platforms.
“Otherwise we face the scary possibility that forcing the tech giants to pay for real news could have the perverse effect of incentivising the amplification of fake news.
“Facebook and Google won’t share their information. While they tell us they’re cracking down, we have to take this on a ‘trust us’ basis,” he said.