- Google and Facebook face tough new rules when dealing with Australian media companies, under a code drafted by the ACCC.
- If adopted, the digital platforms would be required to come to the negotiating table and compelled to pay a “fair” price for media content.
- They would also need to be more transparent with media companies when tinkering with their algorithm and collecting user data.
- Visit Business Insider Australia’s homepage for more stories.
Australia could force tech giants to the negotiating table with local media companies under a newly released draft competition code.
Released on Friday by the Australian Competition and Consumer Commission (ACCC), the draft mandatory code is being touted as a way to secure a “fair” price for news content.
“There is a fundamental bargaining power imbalance between news media businesses and the major digital platforms, partly because news businesses have no option but to deal with the platforms, and have had little ability to negotiate over payment for their content or other issues,” ACCC Chair Rod Sims said.
In developing the code, Sims said the ACCC wanted to avoid “unproductive and drawn-out negotiations, and wouldn’t reduce the availability of Australian news on Google and Facebook.”
It comes as part of the organisation’s broad and long-running ‘Digital Platforms’ inquiry to curtail the extraordinary influence the two tech titans wield, commit them to proper codes of conduct, and break their dominance in online advertising and media.
While it’s still very much a work in progress, this particular code focuses on that last objective. Here’s what it proposes.
Media companies could put Google and Facebook on notice
The code would compel the digital platforms to bargain with media companies in good faith.
“News content brings significant benefits to the digital platforms, far beyond the limited direct revenue generated from advertising shown against a news item. News media businesses should be paid a fair amount in return for these benefits,” Sims said.
Under the provisions, media outlets could join together to enhance their negotiating position in a move aimed to give more weight to small media businesses.
“Under our plan, these businesses could again work together to negotiate with the platforms over fair payment for their content,” Sims said.
If they can’t come to an agreement they’ll have a three-month window to negotiate and mediate. If that process fails, there would be a ‘final offer’ arbitration process, with each media company having jut “one chance to make an offer”.
Greater transparency around algorithms, user data and original news
The code extends beyond just a fair price for a fair day’s news however, laying out terms for how Facebook and Google would have to treat media companies.
Specifically, they will be compelled to notify all news businesses 28 days ahead of any algorithm changes that would “materially affect referral traffic”, advertising or the presentation of news content.
The platforms would also be required to be transparent about how they collect user data via their interaction with news media, including how long readers remain on an article, how many articles they consume and other engagement information.
On top of all this, they would need to allow media outlets to be able to toggle comments on and off on different articles and exclude their content from being included on digital platforms.
If adopted, any breaches would carry serious penalties of up to $10 million, three times the benefit of a breach or up to 10% of local turnover. That last provision theoretically (albeit improbably) places the ceiling for penalties at $500 million between the two based on last year’s turnover before advertising.
Now to see how much of this the ACCC can actually get over the line.
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