How Facebook, TikTok and Google will be forced to pay for Australian news under Anthony Albanese’s bold plan
Tech companies that refuse to make deals with Australian publishers will pay the price as the government plays “four-dimensional chess” and forces the industry to fund news.
The federal government will introduce a news bargaining incentive to force major tech companies that generate more than $250 million in Australian revenue to pay the Commonwealth or make deals with publications regardless of whether they cover news.
The indictment from January affects Google, TikTok owner Bytedance and Facebook and Instagram’s parent company Meta.
X, formerly Twitter, is unlikely to be subject to this incentive as its Australian revenues are less than $250 million.
The charge was not intended to boost revenue for the Commonwealth but to encourage companies to make deals with news publishers, Communications Minister Michelle Rowland and Assistant Treasurer Stephen Jones said.
“Michelle and I have been playing four-dimensional chess on this for 12 months,” Mr Jones told reporters in Sydney.
“We want to ensure that the platforms involved and all news media can continue to make deals and produce great journalism.”
Meta revealed in March it would not renew deals with Australian publishers, which could cost the industry $70 million.
Federal Communications Minister Michelle Rowland (pictured) will impose a levy on social media platforms that profit from news content from January
Facebook is removing its news tab, but after years of growing its audience by sharing news content (stock image)
As negotiations with the government stalled, representatives said the company would consider banning all Australian news content from Facebook if it were forced to operate under the news media bargaining code.
Despite the threat, Mr Jones believed most platforms would work with this incentive.
“It would not be an economically rational decision to pay more than you would have to pay under a commercial agreement,” he said.
‘Both parties benefit from entering into commercial agreements, and they will provide much more detail, much more in each direction in return for value than they would under a cost arrangement.’
Social media platforms once filled their feeds with news content to attract signups and engagement, which drew attention and revenue from the source websites.
In an effort to return money to publishers, the previous Liberal government introduced a world-first news media bargaining code that legally required digital platforms to enter into commercial deals with eligible media outlets, under penalty of fines of up to 10 percent from their local media. gain.
As the user base has grown, social media platforms have begun to suppress news content and choke off traffic to publications.
Instagram users must explicitly opt-in for “political” content, Facebook has put its news tab on the background, and X has stopped showing news headlines and links on posts.
Elon Musk-owned X is unlikely to be part of any enforced bargaining incentive because it doesn’t get enough revenue from news in Australia
News Corp Australasia director Michael Miller welcomed the incentive and said he would contact Meta and TikTok about commercial agreements.
“This will provide a foundation for rebuilding the media industry following the loss of an estimated 1,000 jobs this year and ensure Australian news media companies continue to deliver investigative and professional journalism,” he said in a statement.
Meta, on the other hand, had some reservations.
“We agree with the government that the current law is flawed and remain concerned about charging one sector to subsidize another,” a spokesperson said.
“The proposal does not take into account the reality of how our platforms work, specifically that most people do not come to our platforms for news content and that news publishers voluntarily choose to post content on our platforms because they get value from it.”