Media, Big Tech code by the end of the year

Denham Sadler
Senior Reporter

The government still plans to introduce legislation imposing a bargaining code between tech giants and media companies, with Google outlining its conditions for agreeing to such a concept.

The federal government has been consulting on the draft news bargaining code since it was released in July and has faced heavy lobbying from tech giants Facebook and Google and large news companies.

Both of the tech giants have also campaigned publicly against the code, arguing it would impede their services and threatening to block the posting of Australian news content or leave Australia entirely.

Mel Silva
Mel Silva: The Google Australia VP has concerns about the one-sided nature of negotiations

The draft code, emerging from the Australian Competition and Consumer Commission’s 18-month inquiry into digital platforms, would require Facebook and Google to enter into final offer arbitration with news media companies for a revenue-sharing agreement if a deal is not reached after three months of negotiations.

An independent arbitrator would then select from one of the final offers, and this decision would be binding under law.

The draft code also required the tech companies to provide 28 days’ notice of any relevant algorithm changes to how news content is presented, be more transparent about the data it collects about news readers and to not discriminate in the presentation of news content.

The federal government has confirmed that it intends to legislate the media bargaining code by the end of the year, meaning it will be debated in Parliament in early December. There’s unlikely to be many revelations about changes to the draft code before then, with reports those involved with negotiations have been forced to sign non-disclosure agreements.

In a new post on Monday, Google Australia vice-president Mel Silva outlined the company’s final demands for the bargaining code.

“While we have come to the table with new commitments, we’ve seen major news businesses doubling down on their argument that the code should be built on an uncommercial and one-sided negotiation model, unprecedented in Australia, that misconstrues the ‘value transfer’ news businesses claim to provide to Google – and ignores the more than $200 million in annual value that Google provides to publishers,” Ms Silva said.

“In other words, major news businesses would simply be entitled to discuss the amount of revenue they’d like to be transferred from Google’s accounts to theirs.”

The sticking point for the tech titans appears to be the forced arbitration element of the code, with Ms Silva also saying it needs to address both sides of the value exchange, and allow publishers to decide whether their content can be found on Google.

“We support a code, but we cannot agree to one that doesn’t incorporate these fundamental elements. No responsible business would cross these red lines. But there is a way forward that we believe achieves the goals of both publishers and the regulators, and which is realistic and fair for all parties,” Ms Silva said.

“As work on finalising the code continues, we’ll keep making the case for an approach built not on unprecedented arrangements, but on a fair, workable code and mutually beneficial, commercial discussions between publishers and digital platforms. Australia’s future as a strong digital economy depends on it.”

While confirming there will be changes made to the draft code, ACCC chair Rod Sims has labelled the forced arbitration clause the “glue” holding it together.

“We would look a bit silly if we didn’t make any changes to a draft, we’d look a bit pig-headed. There will be changes, they’ll come from discussions with Google and Facebook and the news media businesses,” Mr Sims said.

“It’s a draft and a draft is meant to illicit comment, and we’ve got a lot of comments. We’re sifting our way through that and there will be changes.”

Conditions in the draft code that the tech companies give publishers advance notice of algorithm changes are “technically impossible”, Ms Silva said, and should instead require only reasonable notice about significant changes.

Mr Sims has signalled that there may be changes to this part of the code, saying it has led to misunderstandings with Google and Facebook.

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1 Comment
  1. Anonymous 4 years ago

    Very amusing to hear a BigTech mouthpiece complaining about “the one-sided nature of the negotiations”.

    It seems just how most of their customers feel about their usage experiences!

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