With the government having moved to enforce a mandatory code of conduct that will see tech giants pay media companies for news, the question now becomes how much?

And now Nine has put a price tag on what it believes the agreement to be worth.

Speaking with the Australian Financial Review, Nine chairman Peter Costello [feature image] said tech giants like Google and Facebook should pay about $600 million a year into a fund to be distributed between local media companies.

This would equate to roughly 10 per cent of local revenue.

“We think that Google and Facebook are driving advertising revenue of about $6 billion in Australia, and roughly 10 per cent of that is as a result of news content,” Costello said.

“So, if you apply those figures, Google and Facebook are taking about $600 million of advertising revenue out … which otherwise could have, or should have, been going to media.

“You might say, ‘what’s wrong with that? They’re entitled to take this’. Well, what’s wrong with it is they are essentially using the product which is created by news organisations without paying for it. In fact, using it to boost their own revenues and taking the advertising which otherwise would go to support that journalism.”

When the government announced it would be enforcing the mandatory code last month, both Google and Facebook revealed they had been in negotiations with local media companies to create a voluntary code.

It is unclear whether the figure these companies put forward was close to the 10 per cent mark Costello is calling for.

Google did not wish to comment on Costello’s remarks, but pointed to a recent blog post, in which the tech giant pointed to the pre-existing benefits these media companies reap from Google.

“All publishers on the internet want to be found by new users, alongside businesses that include news media interests,” Google said.

“Publishers have always been able to decide whether their content shows up in Google Search. Most choose to be found via Google to attract more visitors to their sites.”

Facebook had not responded to B&T‘s request for comment at the time of publication.

With a draft code of conduct expected by July, the world will be watching to see how the Australian government goes about forcing these companies to pay for news.

While regulators around the world have been looking at the matter for some time, the mandatory code is a world-first.

“It is only fair that the search engines and social media giants pay for the original news content that they use to drive traffic to their sites,” said Treasurer Josh Frydenberg upon announcing the code last month.