The Australian government has ordered social media giant Facebook and search engine Google to share the revenue generated from news articles, Bloomberg reported on Saturday.
Australian Government Treasurer Josh Frydenberg said the two companies will have to negotiate for remuneration with traditional media in good faith. The move intends to ensure a “level playing field” for Australian companies. A draft code is under consultation till August 28 and covers only Facebook and Google at present, but may be expanded to include more platforms in future.
“It’s about a fair go for Australian news media businesses,” Frydenberg told reporters in Melbourne, according to Reuters. “It’s about ensuring that we have increased competition, increased consumer protection, and a sustainable media landscape. Nothing less than the future of Australian media landscape is at stake.”
The Scott Morrison-led government in Australia had late last year told Facebook and Google to negotiate a voluntary deal with media companies to use their content. But these talks failed to reach a conclusion. The Australian government has now said that if an agreement is not reached within 45 days, the Australian Communications and Media Authority will set legally binding terms on behalf of the government.
Australia’s move comes a day after the chiefs of Facebook, Google, Amazon and Apple were grilled by United States representatives in a congressional hearing, for allegedly abusing market power to the detriment of smaller companies.
In 2019, a study showed that about 3,000 journalism jobs have been lost in Australia in the past 10 years, as traditional media companies lost advertising revenue to Google and Facebook, who did not have to pay for their content. Frydenberg said that for every AUD 100 (Rs 5,349) spent on online advertising in Australia, 1/3rd goes to Google and Facebook.
Google has criticised the Morrison government’s move to ask it to share revenue. It said the directive ignores the “billions of clicks” it sends to Australian media every year. “It sends a concerning message to businesses and investors that the Australian government will intervene instead of letting the market work,” Mel Silva, managing director of Google Australia and New Zealand, said. “It does nothing to solve the fundamental challenges of creating a business model fit for the digital age.”