Australia Finally Enact The Law That Requires Facebook And Google To Pay Publishers

The Australian government finally enact its proposed content payment law that mandates Facebook and Google to mediate payment with Australian publishers — defaulting the new law has consequential outcomes according to the Australian Competition and Consumer Commission (ACCC).

“This is a significant milestone — this legislation will help level the playing field & see Australian news media businesses paid for generating original content,” the Australian Treasury, Josh Frydenberg (the man who led or pushed-support the law).

In context with Frydenberg’s comment, the ACCC harbours many expectations from law’s engagement — the unruly power imbalance between the US-based tech companies and Australian publishers during bargains will be probed by the law.

Google and Facebook have strongly objected to the new content payment code. Initially, Google threatened the Australian tech industry if they continue to enforce the law — they bluffed about their search engine pullback, which will leave Australia with degraded internet tools.

After a short while, Google signed deals with major Australian publishers. The multi-million dollar deal the search engine company endorsed to support media houses allowed their contents display as search results. According to Google’s agreement with the Australians, Rupert Murdoch’s News Corp is entitled to three years of “significant payments” from Google.

Accordingly, Facebook also expressed fierce dissent towards the Australian content code. Consequently, the social media company kicked Australians off its world — they banned Australians from sharing or reading domestic or foreign content via Facebook.

The Australian government took considerations to make significant adjustments to its law while Facebook decided to call off the ban, reinstating Australians on its platform with respects to news reading and sharing.

According to the new Australian content law, the news media bargaining code mandates Facebook and Google mediate on a certain fee to pay Australian publishers for news content, which also requires an arbitrary process to accredit the deal. The law also demands that tech companies should notify media houses about any changes in their algorithms.

The fear of an arbitration process encouraged Facebook and Google to disagree with the Australian content payment law — an autonomous entity forcefully decides the value of news feeds, news contents, and search results which the tech companies have strongly avoided.

The lucrative service Facebook and Google has offered overtime instigated the Australian government to regulate their businesses. The prospect of the law drafted for the major tech companies is said to extend to other social platforms in the nearest future.

The Australians’ adjustment indicates that the country’s government will keep accurate track of the commercial deals that transpired between both parties. After a year, the ACCC will review the content code to assess its impact on the social industry.

However, Google’s reactions towards the arbitration process that demands paying other companies linked to access its search services are wavy, and they are suspected of taking their initial threat seriously. According to Google, the arbitrator will focus on the cost of running a news outlet but neglects the expenses involved in its business.

In response to Google, ACCC centred its arguments on the facts they discovered about the outrageous amount of revenue tech companies usually generate annually, conforming to the 18-month research they endorsed on tech firms.

The ACCC also noted that tech companies realized times ten of their regular revenue during the pandemic. The 2020 pandemic resulted in several media houses laying off their staff, and others shut down while tech companies continued to boom.

Nonetheless, Microsoft, the Bing search engine’s parent company, publicly supported the Australian government — Microsoft said the Australians “reasonably attempts to address the bargaining power imbalance between digital platforms and Australian news businesses.”

 At the same time, they pledged total cooperation if the laws demand their payments. Microsoft also indulged the US and the EU to emulate such regulations.

The Australian content law has effectively stretched outside its borders. Media houses including Wall Street Journal, Washington Post, the New York Post expect a pay check from Google and Facebook.