Australia: Big tech companies should pay for journalistic content

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With strict guidelines and official controls, Australia wants to achieve what has already failed several times elsewhere: the government wants to introduce a law to charge operators of major search engines and social media platforms if journalistic content from Australian media is distributed on their portals.

The Australian Taxation Office has announced that the government is planning to introduce a new law to this effect, the so-called "News Bargaining Incentive". This translates as an "incentive to negotiate news content" and is primarily intended to be a mandatory monetary levy. It is to be implemented annually from 2025 and would affect all operators of search engines and online social platforms that generate at least 250 million dollars in gross revenue in Australia in a given financial year. This plan is at least explosive for Google and Facebook, or rather their operators Alphabet and Meta. They have already concluded agreements with individual Australian media companies in the past.

Finance Minister: imbalance in the market

Australia's Finance Minister Stephen Jones sees a significant imbalance between tech companies and media companies, which his government is taking as an opportunity for the new law: The audience of journalistic content would often access it via social media or search engines. Tech companies such as Google or Meta would benefit from this development, while products from traditional media companies such as printed newspapers or their own online offerings would be at a disadvantage, he explained in a press release. Over the past ten years, the market volume of the Australian newspaper market has suffered greatly: according to a projection, it fell from 3.9 billion in 2014 to around 2.4 billion in 2024. Google and Facebook have seen the opposite development: According to a Financial Times report: from 2013 to 2019 alone, the revenue of both platforms grew in total from around 500 million Australian dollars to around two billion dollars.

However, it should be possible to avoid the levy if the respective tech companies behind the platforms reach agreements with the media companies on their own initiative – As the name of the bill suggests, it is intended as an incentive to negotiate precisely such agreements with media companies. If tech companies make voluntary payments to media companies, this is intended to offset the compulsory levy to the Australian government and release them from this obligation. In turn, the government wants to pass on the proceeds from the compulsory levies to the media companies without any deductions. This is still a draft and is now to be finalized together with industry representatives.

Not the first attempt of its kind

This is not Australia's first attempt to give media companies a share of the revenue that the government believes big tech companies generate from journalistic content. The "News Media Bargaining Code" already existed in 2021 with the same aim. Meta and Google then reached an agreement with Rupert Murdoch's media group News Corp, the newspaper publisher Nine Entertainment and a number of other smaller media companies. In total, the media companies received around 200 million Australian dollars (around 130 million US dollars) a year for their content being found via search engines and distributed on social media.

However, according to Jones, under the old law, the tech companies were able to partially circumvent the payments by specifically filtering the journalistic content in their services so that it was displayed as rarely as possible. Meta has since announced that it will not be paying the levy under the old law this year because the demand for news content among its users is far too low – The company cites the fact that the use of Facebook News, the platform's own newsfeed, has fallen by around 80 percent. This justification would no longer be possible with the new law, which requires payments regardless of demand in the respective search engines and social platforms.

Attempts in the USA and Canada failed

For more than a decade, publishers in Europe, the USA and Canada have also been trying to get technology platforms –, in particular Google –, to systematically pay for the use of news. However, there has only been partial success so far. The introduction of the first EU-wide law failed in Brussels in 2009. In 2019, the EU passed its copyright reform. On the basis of the ancillary copyright contained therein, Google reached an agreement with various publishers on payments for the use of "extended previews of news" – excerpts or summaries of journalistic content.

In November, Google launched a test on its search engine, which is presumably intended to question the status quo: In some European countries – Germany excluded –, news articles that fall under the ancillary copyright law are filtered out for one percent of Google users. Google wants to show how much traffic media companies are really missing out on through the search service.

Canada has already failed with its Online News Act, according to which Google and Meta should pay for referring readers to media reports. Google in Canada unceremoniously stopped pointing to news. Canada's government finally gave in and significantly reduced the so-called link tax for Google. In the US state of California, Google in turn warned non-profit newsrooms that the passing of a new Californian law to tax online advertising would jeopardize the company's future investments in the US news industry. To avert the law, Google prefers to voluntarily pay millions to publishers. Journalists nevertheless call the deal a disaster.

Google and Meta: no comment on Australia

Australia's major media companies were pleased with the government's plans. Michael Miller, CEO of Rupert Murdoch's News Corp Australia, said according to a report in the Financial Times that the Australian government had shown that it was prepared to take a leading role when it came to how technology companies should operate in society. Negotiations with Meta and TikTok will begin as soon as possible.

Matt Stanton, Deputy Managing Director of Nine, the publisher of the Sydney Morning Herald and the Australian Financial Review, also welcomed the new legislative plans and spoke of an "incentive" for tech platforms. He told the Australian radio station 2GB that it was a bit of a "carrot and stick" approach. According to the Financial Times, Google and Meta have not yet commented on the new plans.

If Australia's course is successful, efforts in other parts of the world to make tech companies pay for the use of journalistic content could also pick up speed again. Attempts like those in Europe or Canada to undermine existing regulations with filtering would probably no longer be possible with a model like the new law in Australia.

(nen)