Australia passes law forcing tech firms to pay for news providers’ content

Last week, Facebook blocked its Australian users from sharing news on the platform over the new law but said it would restore the service on Tuesday after discussion with the government.

The agreed upon changes mean the government may not apply the code to Facebook if it can demonstrate it has signed enough deals with media outlets to pay them for content. Firms affected by the code were also given a month to comply with the new rules.

Rod Sims, the competition regulator who drafted the code, said he was satisfied the amended legislation would address the market imbalance between Australian news publishers and the two gateways to the internet.

“All signs are good,” he said. "The purpose of the code is to address the market power that clearly Google and Facebook have. Google and Facebook need media, but they don’t need any particular media company, and that meant media companies couldn’t do commercial deals.”

Facebook’s news ban was poorly received as it also blocked many non-profit and government pages, including those of public health agencies promoting reliable information about Covid-19.

The new law sets the stage for a dispute-handling process largely untested in corporate Australia and its progress will be watched closely by other governments.

Earlier this month, Australian Prime Minister Scott Morrison said Microsoft’s Bing search engine could replace Google’s own if the latter pulls out of the country over the new rules. He reportedly spoke personally with Microsoft CEO Satya Nadella on the possibilities.

Country Press Australia, which represents 161 regional newspapers across the country, has raised concerns that tiny publications outside large cities might miss out on media deals with the biggest tech firms.

But Sims said he was not surprised the platforms would strike deals with large city businesses first.

“I don’t see any reason why anybody should doubt that all journalism will benefit,” he said.

“These things take time. Google and Facebook don’t have unlimited resources to go around talking to everybody. I think this has got a long way to play out,” he added.