Australia is approaching a legally binding framework to force the adtech giant Facebook and Google pays media companies to monetize their news content when posted to their social media platforms or if not collected and monetized.
Back April The country’s government announced it would adopt a mandatory code that requires technology giants to share advertising revenue with media businesses after efforts to negotiate voluntary arrangements with companies failed to make progress.
Today the Australian Competition and Consumer Commission (ACCC) has published details of the first pass on the mandatory code – which is said to be intended to overcome the “acute bargaining power imbalance” between the local news business vs. adopolit duopoly, Google and Facebook.
The draft follows the consultation process before and after release a concept paper in May, where the ACCC sought feedback on various options. More than 40 submissions were received, he said.
Under the proposed code, the ACCC recommends a binding “final bid” arbitration process as a way to avoid platforms that attempt to drag payment negotiations. Under the proposal, they will get a “negotiation and mediation” of three months, after which the independent arbitrator will choose which of the two parties’ “most reasonable” final offer, by doing so within 45 working days.
“This will ensure that disagreements about payments for content are resolved quickly. An agreement on payment can be reached within six months from the time the code was enacted if arbitration is required, “wrote the ACCC.
This code also aims to enable media business groups (such as local and regional publications) to negotiate together to get a better agreement from the platform that uses their content.
On the law enforcement side, the draft proposes that non-compliance – such as not negotiating in good faith or violating minimum commitments – can lead to penalties for violations, with a maximum set of $ 10 million or 3x the benefits obtained or 10% of the platform turnover. on the market in the past 12 months (whichever is greater). So Facebook and Google can potentially be on the hook for fines running up to millions of dollars if they are found to have broken such a code.
The scope of the application code looks broad enough so that it seems intended to prevent the platform from avoiding payments by only turning off one news-focused product (such as Google News). Google does that in Spain instead of paying to re-use the news footage there (and remains turned off in the market). But the ACCC proposal also applies to search and Find Google so Google must forget about displaying Australian news content to avoid revenue sharing – which is a far greater turn to switch.
Another interesting aspect of the proposal would be to require the platform to provide the news media business about a month (28 days) notification of changes to the algorithm that “is likely to materially influence” referral traffic to news and / or news rankings behind paywalls; and also for “substantial” changes in the appearance and presentation of news, and advertisements directly related to the news.
Another important requirement is that platforms provide news media businesses with “clear information” about the data they collect through user interaction with news content on their platforms – such as how long people spend time on an article; how many articles they consume in a certain period of time; and other data about user engagement with news across all platform services.
This aspect of the proposal appears to be intended to address the problem of dominant platforms using their market power to maintain their grip on economic attention by being able to monopolize access to data by blocking content producers from accessing information about how Internet users are involved with their work.
Platforms like Facebook have trying to concentrate other people’s content for their benefit – applying market power to encourage content to be posted in a place where only those who have full access to interaction data. This breaks the relationship between the news producer and their own audience, making it more difficult for them to do the analysis around the article or respond to changes and trends in consumption behavior.
Apart from so much user data it also makes it difficult for media outlets to foster closer relationships with consumers of their products – something that looks increasingly vital to developing successful additional revenue streams, such as subscription offers, for example.
“There is an inherent bargaining power imbalance between the news media business and major digital platforms, partly because the news business has no choice but to deal with the platform, and has little ability to negotiate payments for their content or other issues,” said ACCC Chair, Rod Sims , commented on the proposal in a statement.
“In developing our draft code, we observe and learn from the approaches of regulators and international policy makers who seek to secure payments for news. We want a model that will overcome this bargaining power imbalance and produce fair payments for content, which avoids unproductive and protracted negotiations, and will not reduce the availability of Australian news on Google and Facebook. “
“We believe the draft code that we are proposing achieves this goal,” he added.
The proposal contains more suggestions aimed at breaking the power imbalance between the two adtech giants and news producers. One element will require them to publish proposals to recognize the original news content on their services – which sounds like an ‘exclusive’ label (to follow the ‘fact-checked’ label platform can sometimes choose to apply).
The pair also needs to provide news media businesses with what the ACCC dubbed “flexible user comment moderation tools” – such as the ability to turn off comments on individual stories posted to the platform.
The theme here is increasing agencies for news businesses vs. Facebook and Google so that they have a better chance to form public debates that take place around their own content – the platform has also devoured the types of conversations that used to occur through newspaper pages.
In terms of eligibility, the ACCC said media businesses would qualify for payments for reused platform content if the online news content they produced “investigated and explained issues that have public significance for Australians” or “issues involving Australians in debate public and inform democratically decision making, or issues related to community and local events “.
Other criteria include following professional editorial minimum standards; maintain the “appropriate degree” of editorial independence; operates in Australia for the primary purpose of serving an Australian audience; and generate income of more than $ 150,000 per year.
The Code, which initially only applies to Facebook and Google (although the ACCC notes that other platforms can be added if they get the same market power), is not intended to capture producers of non-news content, such as drama, entertainment or broadcasting sports.
In a statement responding to Google’s proposal expressed deep disappointment. Mel Silva, MD from Google Australia, said:
Our hope is that the Code will think ahead and the process will create incentives for publishers and digital platforms to negotiate and innovate for a better future – so we are very disappointed and worried that the Code’s design did not achieve this. Instead, heavy government interference threatens to hamper Australia’s digital economy and impact the services we can provide to Australians.
This code discounts the significant value that Google gives news publishers across the board – including sending billions of clicks to Australian news publishers for free every year for $ 218 million. This sent a message about businesses and investors that the Australian Government would intervene instead of letting the market work, and undermine Australia’s ambition to become a leading digital economy by 2030. The Australian Government made nasty disincentives to innovate in the media sector and did nothing. to solve fundamental challenges in creating business models suitable for the digital age.
We urge policymakers to ensure that the final Code is based on commercial reality so that it operates in the interests of Australian consumers, maintains the shared benefits created by the web, and does not support the interests of large publishers at the expense of small publishers.
Facebook has far less to say – sending a line attributed to William Easton, MD for Australia & New Zealand – who said it was reviewing the proposal “to understand its impact on the industry, our services and our investment in the news ecosystem in Australia”.
In terms of Australia’s next steps, further consultations will be carried out on the draft mandatory code during August, with the ACCC saying it will be completed “shortly after”.
Further details about the concept code can be found here.
While regulations that apply to big technology now seem to be given in many jurisdictions around the world – with US lawmakers lives for the damage that flows from a handful of very powerful homegrown tech giants– the question of how fair and effective it will be is raised.
One potentially problematic element of Australia’s approach to revenue sharing from this news advertisement is that it does not seem to address the poor supervision model of capitalism from Facebook and Google – which the rest of it below regulatory supervision in Europe – but it is likely to increasingly embed the media with a data mining business model that works by eliminating consumer privacy to target them with behavioral advertisements.
Critics argue that a great deal of harm flows from behavioral advertising – from clickbait wasting time at the lower end to disinformation that stifles democracy and hatred on the other hand. While others fewer types of annoying ad targeting.
The part of the proposed code that touches on “platform user privacy” only notes that: “The minimum standard concept code requires a digital platform to provide clear information about the data they currently collect through news content. However, this code does not cover any requirements for digital platform to increase user data sharing with the news media business. Therefore, this code does not have an impact on privacy protection that currently applies to digital platform users. “
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