Australia's biggest media companies call on Morrison government to legislate code regulating Facebook, Google

 proxy.yoo.workers.dev  11/22/2020 19:15:00   Stuart Marsh " Senior Producer

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A consortium of Australia's biggest media companies have written an open letter to the Morrison government, calling for a code to have Google and Facebook pay for news content finalised by the end of the year.
The letter, signed by the likes of Nine (the publisher of this website), News Corp Australia, Channel 10, Prime Media Group and Seven West Media, calls on the federal government to act quickly.
Drawing on the Australian Competition and Consumer Commission's (ACCC) Digital Platforms Inquiry, the media companies say Google and Facebook are unfairly profiting off the work of local news organisations.
Nine Entertainment is the biggest media company in the country, calling on the Morrison Government to enact change. (AAP)
"Australians can search for news on Google and share stories with their family and friends on Facebook and Instagram partly because of investment by local news media businesses in quality journalism," the letter reads.
"Google and Facebook generate significant revenues by collecting data on those users and turning it around in highly targeted advertising. This makes news content hugely valuable for the digital platforms.
"Yet Google and Facebook do not currently pay Australian media companies for this valuable content.
"Australian media companies can't avoid using the digital platforms to reach news consumers. Conversely, no single individual media business is critical to the platforms. The result is a significant imbalance in bargaining power."
Google offices, New York (Getty)
The ACCC found that digital giants Google were benefiting from local news content. (Getty)
The letter calls for a News Media Bargaining Code that outlines a fair model of paying news companies for content with limits; protection against news media being discriminated against in their reach on the platforms and be covered on all products such as Google Search and Instagram.
The consortium of companies say 2020 has brought an unprecedented news year, making the work of journalists more important than ever.
"Australians need a strong and vibrant news media sector now, more than ever," the letter reads.
"Through bushfires, floods and the COVID-19 pandemic, Australians have turned to local news organisations across radio, TV and print as their trusted source of information.
"Australians also know that trusted local news sources are under threat. Many have closed, forever silencing local voices."
In an address to Nine's AGM on November 12, Nine chairman Peter Costello said local media companies bear almost all costs of creating news while Facebook and Google benefit.
"The other great challenge in this industry is the market power of the global digital platforms, like Facebook and Google. They are not subject to the content rules that apply to Free to Air broadcasters in the Australian market," Mr Costello said.
"They make very little Australian content and contribute very little to Australian employment.
"Nonetheless, they are able to use the premium content we produce to attract audiences in the Australian market."
Australians need a strong and vibrant news media sector now, more than ever. Through bushfires, floods and the COVID-19 pandemic, Australians have turned to local news organisations across radio, TV and print as their trusted source of information.
Australians also know that trusted local news sources are under threat.
Many have closed, forever silencing local voices.
The global digital platforms should care about the local media landscape. They should care about ensuring the sustainability of the local news media sector.
Why? Because they benefit from it  enormously. But the financial ledger in producing the content is currently very one-sided.
The ACCC spent two years investigating the impact of Google and Facebook on the sustainability of the news media sector. It forensically examined their relationship with news media businesses and their impact on the advertising market.
The ACCC's ground-breaking Digital Platforms Inquiry concluded that the decline over time in public interest journalism outlets in Australia resulted from a drop in traditional media advertising revenues. But as local news media businesses revenues were reducing, the advertising revenues of both Google and Facebook were increasing exponentially.
Australians can search for news on Google and share stories with their family and friends on Facebook and Instagram partly because of investment by local news media businesses in quality journalism.
Google and Facebook generate significant revenues by collecting data on those users and turning it around in highly targeted advertising.
This makes news content hugely valuable for the digital platforms. Yet Google and Facebook do not currently pay Australian media companies for this valuable content.
Australian media companies can't avoid using the digital platforms to reach news consumers. Conversely, no single individual media business is critical to the platforms. The result is a significant imbalance in bargaining power.
That's why we need a News Media Bargaining Code. To survive, local news media businesses must be able to negotiate a fair contribution to the cost of creating content that directly contributes to significant local profits made by Google and Facebook.
The final Code must include:
" Final offer arbitration  this clear and straightforward arbitration model limits incentives on each party to make ambit claims. This is a far more appropriate model than the more traditional slow and expensive arbitration approaches.
" Strong protection against discrimination  in other jurisdictions Google has used its bargaining power to avoid making a fair contribution towards the cost of content creation. Facebook has threatened to do the same in Australia. The Code must include protections against these unreasonable tactics.
" Cover all services  The Code must apply to the full suite of products offered by Google and Facebook, including Google Search and its variants, Facebook News feed, and Instagram.
" Information exchange  The digital platforms must be required to exchange all relevant information with news media businesses that is required for a fair and balanced commercial negotiation.
Internationally, digital platforms have been slow to agree to the proposition that they should pay a fair value for the news media content they use.
It is a fact that the Code will not require the platforms to provide any additional user data to news media companies.
The Code will not stop them from making changes to their algorithms, or require special treatment for news media businesses.
We agree that the Code must be fair to all parties and take into account relevant costs and benefits, including any potential "undue burden" on the platforms' commercial interests.
It is great news for Australians that the Morrison Government has committed to act on this legislation before the end of the year.
Google has publicly said it wants to help fund the future of Australian media. That is certainly something that we welcome. Supporting a fair and reasonable Code is the first step.
The Code is essential to arrest further declines in professional news content in Australia  something our democracy depends on.
Nine (one of the signatories of this letter) is the publisher of this website.
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