Photo Source: Ivan Samkov
Australian media companies will see a shift in how they are compensated for their content, as new regulations force tech platforms like Meta, Google, and TikTok to pay for the use of their material in January 2024. The government’s decision comes as local media outlets face a financial crisis, with many struggling to maintain operations in a changing market.
A History of Balancing Big Tech and Media
Australia made headlines globally in 2021 by launching the news media bargaining code. The law required digital platforms to negotiate fair compensation with Australian media outlets, for driving traffic and consequently advertising revenue to their services. Non-compliance could result in fines of up to 10% of local revenue.
The code initially led to successful agreements between platforms like Meta and leading Australian media organisations, including News Corp and the Australian Broadcasting Corporation. However, these deals are set to expire in 2024, and Meta has signalled it does not intend to renew them.
Platforms like Meta have scaled back their emphasis on news and political content.
Adding to this challenge, these platforms implemented major changes such as the discontinuation of Facebook’s dedicated news tab in Australia and a reduction of news content in user feeds, reflecting a broader strategy to shift away from news globally.
The New Proposal
Digital platforms with Australian-based revenues exceeding AU$250 million or NZ$272.5 million will face charges if they fail to strike commercial agreements with news publishers under the new proposed rules. The charge is not designed as a revenue stream for the government but as an incentive for platforms to negotiate fair deals with media outlets.
Stephen Jones, Assistant Treasurer and Minister for Financial Services, emphasised the initiative’s importance, stating, “The news bargaining initiative will … create a financial incentive for agreement-making between digital platforms and news media businesses in Australia.”
The regulations primarily target Meta, Google, and TikTok, but exclude X (formerly Twitter) due to its lower Australian revenue. The government is confident that platforms will find it economically advantageous to enter agreements rather than pay the charges.
Divided Reactions
The proposed measures have drawn mixed reactions from the tech industry and media organisations.
Meta raised concerns about the feasibility of the regulations, stating, “The proposal fails to account for the realities of how our platforms work, specifically that most people don’t come to our platforms for news content and that news publishers voluntarily choose to post content on our platforms because they receive value from doing so.”
Google echoed these sentiments, warning that the decision “risks ongoing viability of commercial deals with news publishers in Australia.”
Meanwhile, media executives have welcomed the move.
News Corp Australasia executive Michael Miller praised the initiative as a vital step in addressing the financial struggles of the media industry, stating,
“This will provide a foundation for rebuilding the media industry after the loss of an estimated 1000 jobs this year.”
Wider Impact Beyond Australia
The potential impact of the new rules extends beyond Australia. They follow similar measures introduced in Canada, where Meta blocked news content on its platforms after being required to compensate publishers.
The Australian government, however, believes platforms will recognise the mutual benefits of reaching commercial agreements over paying charges.
The proposal reflects a growing global trend to hold Big Tech accountable for its impact on traditional industries beyond financial support for journalism. Australia has taken a tough stance on regulating tech giants, from banning children under 16 from social media to imposing penalties for failing to combat online scams.