SYDNEY (Reuters) – Australia will force American tech giants Facebook Inc (FB.O) and Alphabet Inc (GOOGL.O) Google will pay Australian media for news content in a landmark move to protect independent journalism that will be seen around the world.
FILE PHOTO: The Facebook symbol is seen on a motherboard in this image taken on April 24, 2020. REUTERS / Dado Ruvic / Illustration
Australia will become the first country to require Facebook and Google to pay for news content provided by media companies under a royalty system that will become law this year, Treasurer Josh Frydenberg said.
“It is a fair for Australian media business. It’s about ensuring that we have more competition, better consumer protection and a sustainable media landscape, “Frydenberg told reporters in Melbourne.
“The future of the Australian media landscape is at stake.”
The move comes as tech giants reject calls around the world for more regulation, and a day after Google and Facebook clashed over alleged abuses of market power by U.S. lawmakers at a hearing in Congress. .
Following an investigation into the state of the media market and the power of American platforms, the Australian government late last year told Facebook and Google to negotiate a voluntary agreement with media companies to use their content.
Those talks went nowhere and Canberra now says that if an agreement cannot be reached through arbitration within 45 days, the Australian Communications and Media Authority would set legally binding terms on behalf of the government.
Google said the regulation ignores “billions of clicks” it sends to Australian news publishers every year.
“It sends a troubling message to companies and investors that the Australian government will intervene rather than let the market work,” Mel Silva, managing director of Google Australia and New Zealand, said in a statement.
“It does nothing to solve the fundamental challenges of creating a business model suitable for the digital age.”
Facebook did not immediately respond to a request for comment.
“UNFAIR AND DAMAGE”
Media companies including News Corp Australia, a unit of Rupert Murdoch’s News CorpNWSA.O) lobbied hard for the government to force American companies to the negotiating table amid a long decline in advertising revenue.
“While other countries are talking about the unfair and disruptive behavior of technology giants, the Australian government … (is) taking action for the first time in the world,” said News Corp Australia Chief Executive Michael Miller, it’s a statement.
A 2019 study estimated that around 3,000 journalism jobs were lost in Australia in the past 10 years, as traditional media companies cut advertising revenue to Google and Facebook, which paid nothing for news content.
According to Frydenberg, for every A $ 100 spent on online advertising in Australia, excluding classifieds, almost a third goes to Google and Facebook.
Other countries have tried and failed to force the hands of the tech giants.
Publishers in Germany, France and Spain have lobbied to pass national copyright laws that force Google to pay license fees when it publishes snippets of its news articles.
In 2019, Google stopped displaying snippets of news from European publishers in search results for its French users, while Germany’s largest news publisher Axel Springer allowed the search engine to publish snippets of its articles after traffic to their sites would sink.
Colin Packham’s report; Editing by Stephen Coates
.
