Australia passes law requiring Facebook and tech companies to pay news publishers

Photo (c) Kittichai Boonpong / EyeEm - Getty Images

The tech industry will have time to strike deals with media conglomerates

The Australian government has passed a law that will require companies like Google and Facebook to pay publishers for the news they show. The law’s passage follows a heated debate with Facebook, which along with Google expressed opposition to the idea of being forced to pay publishers to display news links. 

Facebook argued that the law was based on “a fundamental misunderstanding of the relationship between Facebook and news publishers.” The company compared the law to “forcing car makers to fund radio stations because people might listen to them in the car — and letting the stations set the price.” 

Last week, Facebook briefly blocked publishers and users from sharing news links in Australia in response to the proposed law. Since then, Facebook CEO Mark Zuckerberg and Australia’s treasurer Josh Fyrdenberg have reportedly hashed out an agreement that both sides are comfortable with. 

Facebook said Australian officials "agreed to a number of changes and guarantees that address [its] core concerns about allowing commercial deals that recognize the value [its] platform provides to publishers relative to the value [it] receive[s] from them." 

Revisions made

Facebook Vice President of Global Affairs Nick Clegg said on Wednesday that before the changes were made, the Australian law would have let media conglomerates “demand a blank check.”

“Thankfully, after further discussion, the Australian government has agreed to changes that mean fair negotiations are encouraged without the looming threat of heavy-handed and unpredictable arbitration,” Clegg wrote in a Facebook post.

With the amendments, the law now requires authorities to give tech companies at least a month’s notice before they are formally designated under the code. That will give the parties involved more time for negotiations. 

Rod Sims, the regulator who drafted the code, said the changes satisfactorily address the market power imbalance between Australian news publishers and tech and media companies. 

Frydenberg noted that the goal of the law is to make sure that media companies are "fairly remunerated for the content they generate, helping to sustain public-interest journalism in Australia." 

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