Media companies push MPs for a bargaining code before year end

Mariam Cheik-Hussein
By Mariam Cheik-Hussein | 23 November 2020

Australia’s major media companies have united to urge federal parliament to approve a draft news media bargaining code before the end of the year.

The media industry is waiting for the code, which will govern how tech giants pay media companies for their content, to be legislated. 

The federal government has previously stated it would finalise the code before the end of the year, with only two sitting weeks left in parliament.

Nine, Seven West Media, Ten, Southern Cross Austereo, Prime Media, Win, The Guardian and News Corp Australia have signed a letter calling for the code, including key elements that Google has lobbied against, to be approved by parlaiment.

Industry bodies Commercial Radio Australia and Free TV have also signed the letter which is being published in all major print and digital publications today.

“Australian media companies can’t avoid using the digital platforms to reach news consumers,” the letter reads.

“Conversely, no single individual media business is critical to the platforms. The result is a significant imbalance in bargaining power. That’s why we need a News Media Bargaining Code.

“To survive, local news media businesses must be able to negotiate a fair contribution to the cost of creating content that directly contributes to significant local profits made by Google and Facebook.”

There has been opposition to the draft code since it was released, particularly from Facebook and Google.

Facebook, which was found to receive 28% of digital advertising dollars in Australia, said it would remove all news content in Australia if the code was passed.

Google, which was found to get 53% of all digital advertising dollars, has been pushing for key changes, including standard arbitration to be used instead of final offer arbitration,  to support the code.

However, the media companies have highlighted that a final offer arbitration model needed to be adopted for the code, which industry insiders say the government has been looking into as part of discussions with the industry.

The media outlets also call for the code to cover all products offered by Google and Facebook, such as Instagram, Facebook News feed and Google Search.

“Final offer arbitration - this clear and straightforward arbitration model limits incentives on each party to make ambit claims,” the media group letter reads.

“This is a far more appropriate model than the more traditional slow and expensive arbitration approaches.”

The group also pushed against “myths” about the code, saying that while digital platforms “must be required to exchange all relevant information with news media businesses that is required for a fair and balanced commercial negotiation”, the code won’t pass on any additional user data to news companies.

“Internationally, digital platforms have been slow to agree to the proposition that they should pay a fair value for the news media content they use,” the letter says.

“It is a fact that the Code will not require the platforms to provide any additional user data to news media companies. The Code will not stop them from making changes to their algorithms, or require special treatment for news media businesses. We agree that the Code must be fair to all parties and take into account relevant costs and benefits, including any potential “undue burden” on the platforms’ commercial interests.”

News media companies have been hit hard by the pandemic which caused advertising revenue to decline across traditional media.

News Corp made significant job cuts as it repositioned to a digital media company earlier this year, and other businesses have made staff or pay cuts.

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