How Did We Get Here? Everything You Need To Know About The News Media Bargaining Code

As Federal Parliament prepares to sit for the final week of 2020, it is expected that the long-awaited News Media Bargaining Code will be tabled at some point.

The Australian suggests that the code will be immediately referred to a Senate committee for further consideration, meaning we will likely have to wait until the new year before anything is put into law.

Much like the ACCC’s Digital Platforms Inquiry that preceded it, the News Media Bargaining Code has so far proven to be a drawn-out process, after first being announced by Treasurer Josh Frydenberg in April.

Despite the wait, the final version of the code could have serious consequences on the future of both Google and Facebook in Australia.

How did we get here?

The News Media Bargaining Code was originally proposed – following the ACCC’s Digital Platforms Inquiry – as a voluntary code between the tech giants and local media companies to negotiate deals.

According to the government, it would serve as a way to even out the bargaining position between local media businesses and these tech companies.

Barely four months after the announcement of the voluntary code (and in the peak of the COVID-19 pandemic), the government decided there had been “insufficient progress” towards creating a voluntary code and stepped in to enforce a mandatory code.

This was despite the fact both Google and Facebook revealed they had been working with local publishers to negotiate a voluntary code.

The draft code (and the fallout)

In July, after months consultation, the government finally released the draft version of the News Media Bargaining Code, finally outlining how it plans to force two of the biggest companies in the world to pay for news content.

While public discussions leading up to the announcement had focused on a single monetary amount both Google and Facebook should have to pay (Nine said $600 million a year, News Corp said $1 billion) the draft code instead proposed a case-by-case remuneration scheme.

Under the draft code, news businesses and digital platforms will be given three months to strike a deal through formal negotiations.

If the parties cannot come to a decision within this three month period, an independent arbitrator will be called upon to reach a decision.

This will be done within 45 days.

The draft version also proposes fines upwards of $10 million per breach and new “protections” for news businesses that will see Google and Facebook forced to notify these companies of any algorithm changes that could impact how content is distributed within 28 days.

The draft code imposes new data-sharing provisions on both Google and Facebook.

And while the draft code was widely applauded by the likes of Nine, Seven, News Corp and Commercial Radio Australia, both Facebook and Google have been outspoken in their protests against it.

Google has labelled the code “unworkable“, pointing to the fact it generates revenue for media businesses by providing clicks and therefore advertising.

Facebook, meanwhile, has threatened to pull news in Australia completely, should the draft code become law.

“This is not our first choice – it is our last. But it is the only way to protect against an outcome that defies logic and will hurt, not help, the long-term vibrancy of Australia’s news and media sector,” said Facebook Australia & New Zealand managing director Will Easton.

Google has also said Australian users and businesses stand to lose access to certain products and services available on the platform and has already delayed the local rollout of the Google News Showcase as a result of the code.

What happens next?

Google has publicly said it does not oppose the idea of a code to regulate the relationship between tech giants and media businesses and has been pushing for a number of specific revisions.

It remains to be seen whether these changes will be implemented into the final version of the code.

There have recently been reports that both Google and Facebook have been exploring the possibility of local content partners in preparation for the introduction of the News Media Bargaining Code.

The Australian government will have no doubt seen news out of both France and the United Kingdom in recent weeks, where both Google and Facebook have made steps towards paying local publishers for news content.

Globally, Google is ramping up its News Showcase initiative as a way to remunerate publishers and support journalism, while the Facebook News tab has emerged as a way for the Zuckerberg-owned company to pay media businesses.

And while we can expect continued fallout and protests about the final version of the News Media Bargaining Code, it seems that Australia might be part of a global shift in the relationship between tech giants and news publishers.