Australian regulator claims victory in scrap with Big Tech on the news

The Australian competition regulator has declared victory in a three-year battle to get Facebook and Google to pay for news after internet groups signed deals with publishers that could be worth around A$200 million a year.

Rod Sims, chair of the Australian Competition and Consumer Commission, told the Financial Times on Tuesday that the country’s first news media bargaining law had forced big tech platforms to the negotiating table to agree deals with publishers.

“We’re on track for deals everywhere. We’re out there and the media companies are happy — that’s the point,” Sims said in an interview.

Sims made the comments after confirmation from nine entertainment They signed a multi-year content deal with Google and Facebook. The media company, which owns the 190-year-old Sydney Morning Herald, has not announced the commercial terms of the agreement but has forecast that profits for its publishing unit will jump between A$30-40 million ($23 million-$31 million) in the 2022 fiscal year.

Other major media groups in Australia, including News Corp, Seven West Media and state broadcaster ABC, have either completed content deals with Facebook and Google or signed letters of intent to do so.

Dozens of smaller publishers have also struck deals or are negotiating terms after a law was passed in February aimed at making big tech companies pay for news.

Analysts said the apparent success of Australian law could prompt other governments that have struggled to regulate Facebook and Google to adopt a similar model.

Online platforms have captured the vast majority of digital advertising, depleting the resources of traditional publishers. Lawmakers in the US, UK and Canada have proposed similar steps to shift commercial power toward struggling news outlets.

Brian Hahn, an analyst at Morningstar, said other countries should consider the Australian model, which could generate around A$200 million a year for media groups. Google and Facebook did not immediately respond to requests for comment on the number.

The legislation enables Josh Frydenberg, an Australian treasurer, to designate a digital platform as being subject to the News Media Bargaining Act. Under this designation, news providers can first try to negotiate payment with tech groups, but if that doesn’t work, they can request mandatory final bid arbitration, for which there are severe penalties for non-compliance.

ACCC’s Sims said this negotiation/arbitration system was probably more familiar in Australia than elsewhere, but there was no reason why others shouldn’t take the Canberra approach.

“We believe that access to arbitration is an essential step in any system,” he said.

Facebook and Google are strong opposing Legislation with the former Australian news blocking الأخبار From its platform in February for several days.

The platform restored these services after a compromise agreed between Facebook CEO Mark Zuckerberg and Friedenberg, which stipulated that the government would not apply the code to the American company if it made enough deals with the media.

Google said in February that it had agreed to pay news publishers’ salaries through its news display service.

Facebook said it plans to invest $1 billion globally over three years to support journalism.

Sims said that if everyone was able to make deals, there would be no need to be hired under the code, which is a success for media companies.

“It’s actually a very light regulation in the sense that with the negotiation/arbitration model we just want the bargaining power to be equal,” he said.

“Before software deals were done, deals weren’t getting done because Google and Facebook were dealing with people on a ‘take it or leave it’ principle. Deals are now being done by law.”

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