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Australia To Consider Legislation Directing Google, Facebook To Pay News Outlets For Content

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Australia To Consider Legislation Directing Google, Facebook To Pay News Outlets For Content

The Australian Parliament will consider legislation next week that requires Alphabet’s (NASDAQ: GOOGL) Google and Facebook (NASDAQ: FB) to pay news publishers and broadcasters for content.

What Happened, Mate? The legislation, formally known as “Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2020,” is being presented as a means of leveling the playing field between online media and print and broadcast rivals.

“We are not seeking to protect traditional media companies from the rigor of competition or, indeed, technological disruption, which we know benefit consumers,” according to the bill's introduction.

“Rather, we are seeking to create a level playing field where market power is not misused and there is appropriate compensation for the production of original news content. To that end, this bill will establish a new world-leading code of conduct for news media businesses and digital platforms. The code ensures that digital platforms share the benefit they obtain from using Australian sourced news content with the news media businesses who create that content.”

The legislation would not include YouTube, which was omitted at the request of Google. The company launched its “News Showcase” in Australia last week to pay national and regional news outlets for their content.

Google had threatened to pull its search engine service from Australia if the legislation proceeded, but has since withdrawn that threat. A Facebook spokesperson said the company was studying the legislation.

Why It Matters: If the legislation passes, Australia will be the first country to require the online giants to pay for the news content on their respective sites.

Microsoft (NASDAQ: MFST) is advocating for the U.S. to follow Australia's lead, with President Brad Smith writing on the corporate blog, “The United States should not object to a creative Australian proposal that strengthens democracy by requiring tech companies to support a free press. It should copy it instead.”

Smith also noted that Microsoft offered to expand its Bing search engine presence in Australia if Google made good on its threatened closure of service, and he added that Google and Facebook vigorously and successfully lobbied the Trump administration to oppose the Australian legislation.

The Biden administration has yet to make a public comment on the issue.

 

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