The media bargaining bill under review in Australia will force the technology giants Facebook and Google to pay for news content in Australia, and the controversy arising therefrom is being closely watched globally.
Australia’s legislation is the first in the world to solve the problem of media advertising revenue reduction due to US technology companies.
Once the bill is passed, it may have an impact on technology companies and how we get news online.
Technology companies have already begun to take countermeasures. Facebook has imposed restrictions on the reposting of news content in Australia.
So what is going on in this dispute between the Australian government and the US technology giants?
How to get to today?
For a long time, people have been worried about the market dominance of technology companies over media organizations.
Google is Australia’s dominant search engine. It is called by the government to exist like public facilities such as water, electricity and coal. There are almost no competitors in the market.
And social media is an important source of news.
According to a poll cited in the Reuters Institute’s “Digital News Report 2020”, 52% of Australians surveyed use social media as their news source. Facebook ranks first as a source of social media news, followed by YouTube and Facebook Messenger.
In 2018, the Australian government regulator launched an investigation into the influence of Google and Facebook on media and advertising competition.
An investigation by the Australian Competition and Consumer Commission (ACCC) found that technology companies are wealthy and the media cannot compete with them.
In view of this, the regulator recommends the introduction of a code of conduct and stated that it will help create a level playing field.
In July last year, the Australian government announced a draft law implementing the code, and Facebook and Google subsequently threatened to withdraw from services provided in Australia.
What is the news bargaining bill?
The bill requires technology companies to pay for content, but it does not clearly define the value of content.
The purpose of this law is to enable news companies to negotiate with technology companies on content that appears in technology company news feeds and search results individually or as a whole.
If the two parties cannot reach an agreement, it will be submitted to the Australian Communications and Media Authority for arbitration.
The penalty for each violation may be as high as 10 million Australian dollars (7 million US dollars), or 10% of the local turnover of the technology company.
The government said that the code initially focused on Google and Facebook, but may expand its scope to extend to other technology companies.
The reason for this legislation in Australia?
The Australian government believes that tech giants should pay news organizations a “fair” fee for the news they provide.
The Australian government also believes that the difficult situation of the news industry requires financial support because a prosperous media is essential to democracy.
Media companies including News Corporation Australia, a subsidiary of Murdoch’s media empire, have tried their best to lobby the Australian government to force technology companies to come to the negotiating table despite the prolonged decline in advertising revenue.
According to Facebook’s director of Australia and New Zealand, William Easton (William Easton) revealed that in Facebook’s view, the exchange of value between Facebook and news publishers is actually beneficial to news publishers, and Facebook creates for the media The revenue is in the hundreds of millions.
Easton said: “News publishers are very willing to publish news on Facebook, because this can make more people willing to pay for subscription, which not only increases the number of audiences, but also increases advertising revenue.”
But according to AFP quoting the Australian competition watchdog, for every US$100 spent on advertising on the Internet, Google gets US$53, Facebook takes US$28, and the rest goes to other news media, which reduces media revenue.
At the same time, Google’s revenue increased significantly during the same period, with global profits exceeding 160 billion U.S. dollars in 2019.
How does Facebook respond?
Facebook announced that it will prevent Australian users from sharing or viewing news.
The social media giant stated that the proposed law “fundamentally misunderstands the relationship between our platform and news publishers”.
Facebook stated that this legislation made it “faced with a serious choice: either to comply with the law that disregards real relationships, or to no longer allow news content on Australian services”.
Facebook said: “We chose the latter with a heavy heart.”
Immediately after the announcement, Facebook imposed a news ban. Facebook users report that they can no longer see news content on Facebook.
How did Google react?
Google has warned that if the proposed law is passed, Google will remove its search engine from Australia.
But Google now says it has agreed to pay Murdoch’s News Corporation to purchase the content of Murdoch’s news sites.
As part of the three-year agreement, News Corp and Google will work together to build a subscription platform, share advertising revenue, and invest in video news on YouTube.
Google also announced that it has reached agreements with several other Australian media companies, including Jiuyu.
It is unclear what action Google intends to take if the proposed law is passed.
Will this become a global precedent?
Some Australian politicians and media experts think it is possible.
Australian Senator Rex Patrick (Rex Patrick) once told Google. “The whole world will ask to pay for news. Is Google going to withdraw from every market?”
In stark contrast to Google and Facebook, Microsoft has expressed support for the proposed law.
Microsoft said in February: “The code seeks to reasonably address the imbalance in bargaining power between digital platforms and Australian news organizations.”
In Europe, similar controversies are also emerging, but with slight differences.
A new EU regulation on copyright has also caused controversy. According to this regulation, search engines and news aggregators should pay link fees to news websites.
In France, news organizations recently reached an agreement with Google on how to resolve copyright issues.
But only a few well-known French newspapers have signed such an agreement, which is completely different from the broader and stricter Australian legislation.
The relationship between the government and giant technology companies is also quite tense in other areas. The European Union and many governments have begun to study the supervision of related companies.
The European Union is studying to resolve illegal and harmful content on online platforms and to manage their use of customer data, while in the United States, technology companies are questioned by Congress in 2020 for allegedly monopolizing.
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