SYDNEY: Australia unveiled a draft law Friday to force Google and Facebook to pay news media for their content in a “world-leading” initiative sure to prompt a confrontation with the US digital giants.
Treasurer Josh Frydenberg announced the “mandatory code of conduct” to govern relations between the struggling news industry and the tech firms after 18 months of negotiations failed to bring the two sides together.
In addition to payment for content, the code covers issues like access to user data, transparency of algorithms and ranking of content in the platforms’ news feeds and search results.
“Nothing less than the future of the Australian media landscape is at stake with these changes,” Frydenberg said at a news conference.
He said legislation implementing the code would be introduced into parliament in the coming weeks and include “substantial penalties” that could cost the tech companies hundreds of millions of dollars.
While the code could eventually apply to any digital platform, Frydenberg said it would initially focus on Facebook and Google, two of the world’s richest and most powerful companies.
Google responded quickly, saying it was “deeply disappointed” with the proposal.
“The government’s heavy-handed intervention threatens to impede Australia’s digital economy and impacts the services we can deliver to Australians,” said Mel Silva, Google’s managing director for Australia and New Zealand.
Australia’s initiative has been closely watched around the globe as news media worldwide have suffered in an increasingly digital economy where advertising revenue is overwhelmingly captured by Facebook, Google and other big tech firms.
The news industry crisis has been exacerbated by the economic collapse caused by the coronavirus pandemic, with dozens of Australian newspapers closed and hundreds of journalists sacked in recent months.
Unlike other countries’ so-far unsuccessful efforts to force the platforms to pay for news, the Australian initiative uses competition law and not copyright regulations to challenge what Australia calls an “acute bargaining power imbalance” between media and the US giants.