Australia’s government is finally on the front foot over Google and Facebook, as the parliament has passed a new law that will require Google and Facebook news outlets to pay for the content.
As per the law, both the Tech giants have to pay a nominal payment to news organizations for using and publishing their content.
According to ACCC, this will acknowledge a significant haggling power disparity between the Australian News Media business and these 2 Tech Giants – Google and Facebook.
Did Google and Facebook kneel in front of Australia?
The clear answer is NO. This new law has faced savage resistance from both Google and Facebook.
Adding more, If we talk about Facebook, then it has blocked all Australian users and publishers from sharing any news matter on its principal social network temporarily and decided to come around only if the Australian Government agrees to make a series of amendments to the proposed law.
Nevertheless, Google remains behind decided that in the first instance, It will drag its search engine from the country in the proposed law commences, but soon it took you to turn on its plans.
Instead of this, Google has chosen to sign a pact with media organizations to pay them for their content. This is initially for a period of 3 years with Rupert Murdoch’s News Corporation, which included a notable payment from google to host matters from different publishers like The Wall Street Journal and The New York Post.
As per sources, these deals are to avoid paying for stories in regular search results.
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Microsoft’s support with the Law
The law is only earmarking Facebook and Google, but we can expect that it may expand to other platforms as well where haggling power disparity between Australian News Media business arise.
However, Amendments to the Law state that the Government can consider any commercial contract that a tech organization enters with news publishers before officially nominating it under the code. The law is still in consideration to be reviewed for the year it commences to analyze and calculate its impact.
Microsoft stands evenhandedly with the law. Microsoft owns Bing search engine, which hardly has a 5% search engine market share in Australia. Microsoft says that it will abide by the rules of the law.
The necessity of the Law
This law was necessary because it counters a loss of advertising revenue from existing news and media organizations.
ACCC asserts that the law has been passed after an inquiry of 18 long months, which clearly resulted that tech giants were taking an inadequately substantial share of online advertising revenue, the cost of which is borne by media organizations.
How will the Code operate?
- Media and advertising companies will be heartened to ink deals with Google and Facebook, not in the code.
- This code allows companies to haggle and reach an irrevocable agreement.
- If there is any disagreement by either of the parties, then a final offer arbitration model will commence determining the level of payment.
- Digital companies will give advanced notice of 14 days in case of substitution that affects media business.
- Digital platforms can also make standard offers to keep haggling costs affordable for small companies.
What if Google and Facebook refuse to work out?
If any of the companies, Google or Facebook, refuses to negotiate, they will be charged a penalty of $10 million or 10% of Annual Australian Turnover or three times of the benefit obtained? Whichever is greater.
But, a rigid penalty will be charged if any of them breaches the principal provisions of being unsuccessful to haggle or take part in arbitration in good faith, failing to comply with an arbitration decision, or engaging in retaliatory action against news media companies.
The question that arises is how long and farther will other countries go in forcing these tech platforms to pay remuneration for news. As per some sources, Some officials in Canada and Europe have shown support for the law. But in the United States, lesser support for the law has been seen.