Australia may become the first country in the world to force Google and Facebook to pay for news content.
As per reports, Australian government proclaimed legislation last month after an enquiry it said showed the tech giants held too much market power in the media industry, a situation it said posed a possible threat to a well-functioning democracy.
Under the code, the tech giants will be subject to compulsory price arbitration if a commercial agreement on payment for Australian media cannot be reached.
Australian Competition and Consumer Commission Chairman (ACCC) Rod Sims said in a statement that,
“This bargaining code is a journey, if we see market power elsewhere, we can add them to the code.”
He added to his statement,
“The regulatory code was the best approach to ensure a level playing field, noting that competition laws around the world had failed to stop Facebook and Google gaining significant market power,”
“Let’s see how it goes; no point trying to optimize now.”
The Australian law, which has broad political support and is expected to be voted on in parliament early this year, was formulated after an ACCC inquiry that found for every A$100 of online advertising spend, $53 goes to Google, $28 to Facebook and A$19 to other media companies.
The ACCC has focused more and more on the rapidly growing market power of Google and Facebook. It has two inquiries open into advertising technology and mobile app stores, with reports due in January and in March, respectively.
Sims, who expressed concern about excessive pricing and self-preferencing by the app stores, said the reports would show the state of play and added that the regulator would continue to focus on data concerns in 2021.
“I’m hopeful that not just Australia, but companies overseas will benefit from what we find,” Sims said.