Social media giants will soon be hit with new rules forcing them to either strike deals with media outlets to pay for content, or pay a set “charge” on their revenue.
This charge, or the News Bargaining Incentive, is the latest addition to an existing industry code legislated in 2021 that was supposed to push Big Tech companies to enter into payment deals with major outlets in Australia.
At the beginning, several deals were struck between Meta, Google, and Australian news outlets including the Australian Broadcasting Corporation, News Corporation, and Nine Entertainment.
However earlier this year, Meta refused to renew its deals and threatened to abandon Australian news from its platform.
The company said the existing deals under the Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Act of 2021, was costing it $70 million (US$44.9 million) across all its platforms.
The new Bargaining Incentive is effectively aimed at forcing Meta to pay its share—which will be more expensive than doing deals—this will then be diverted to a fund for public interest journalism.
“The bargaining incentive includes a charge and an offset mechanism. Platforms that choose not to enter or renew commercial agreements with news publishers will pay the charge. Platforms with these agreements will, however, be able to offset their liability.
“The incentive will apply to large digital platforms operating significant social media or search services irrespective of whether or not they carry news,” ministers said in a statement.
Further, the new policy will also apply to companies that turnover $250 million in Australian-based revenue, meaning it will catch the Chinese-owned TikTok, but not X, with Assistant Treasurer Stephen Jones noting he would be “astounded” if X generated that much revenue locally.
“This approach strengthens the existing code by addressing loopholes that could see platforms circumvent their responsibility to pay.”
Apple, Amazon, and Microsoft are unlikely to be caught in the new policy because they do not meet the legal definition of a social media platform.
Communications Minister Michelle Rowland said the government was committed to maintaining a sustainable news industry.
“Large digital platforms have an important role to play in providing access to news for all Australians, and contributing to the sustainability of public interest journalism,” she said in a statement.
New US Presidency a Factor
The ministers will also have to consider the impending U.S. presidency of Donald Trump.“Those are discussions being handled by our officials in the U.S. I’m aware that there’s been briefings and they’re very much appreciative of the advanced notice of the announcement we’re making today,” said Assistant Treasurer Jones.
Trump has stated before that Big Tech firms, including Apple CEO Steve Cook, have approached him to help deal with heavy regulation by governments around the world.
Digital Group Cites Lack of Consultation
The Digital Industry Group (DIGI), an Australian industry body representing social media and tech companies in Australia, criticised the government for what it said was a lack of consultation on the new rules.“This intervention into private commercial agreements should be subject to proper consultation,” a statement from DIGI said.
“This proposal sees a small subset of one sector being forced to commercially subsidise another, and we don’t believe such a tax exists in any other area of the economy.
“There are many unanswered questions about this proposal, including whether there will be any requirement that funds are actually used to support public-interest journalism.”
