How to make internet giants pay for news
The Covid-19 pandemic has been a difficult time for the media industry, especially for mainstream print media. As lockdowns kicked in and people began to fear catching the infection, media companies saw newspaper sales drop off a cliff. For an industry that struggled to manage its revenue and bottom line anyway as the digital revolution forced fundamental changes in the information delivery industry, the loss of subscribers was a blow. debilitating.
But it was in the gloom of closed editions and sacked journalists that news arrived from Australia, insisting that internet giants like Google and Facebook pay their fair share for news content that also helps. to drive traffic to their services. Several countries said they would take inspiration from the Australian book while there were also calls in India for the government to step in and allow the media industry to feed off the news they create. The Center has shown that it is ready to take on WhatsApp and Twitter when it comes to obeying the law of the land. Here’s a look at how countries made big tech pay for news content.
Put money where the mouth is
Social media giants argue that their core philosophy is to enable the creation of a more open and vibrant internet, but one fact of their inexorable rise is how they have managed to gain inordinate influence over the internet itself. Think about it, Facebook itself and its key platforms like WhatsApp and Instagram have billions of users while Google is the predominant search engine in most of the countries in which it operates.
Prior to the introduction of the Mandatory Media and Digital Platforms Trading Code, research by Australia’s competition watchdog showed that the number of journalists in print publications fell 20% between 2014 and 2018. In addition, between 2008 and 2018, 106 local and regional journalists closed newspapers across Australia.
How Australia got Facebook and Google to play ball
As part of efforts to introduce the Media Trading Act, the Australian Competition Authority has launched a comprehensive investigation into the impact of internet giants on the news industry.
Making a strong case for social media giants to pay for news, the report states that around 50% of traffic to Australian news sites comes from Google or Facebook. Now, as these companies have pointed to this data to say they are doing nothing but helping the news
organizations to attract more users, the report highlighted how social media also benefits people seeking information.
Australia’s competition watchdog found that 8-14% of Google search results trigger a “Top Stories” result, which could include reports from news media websites. Today, 3.5 billion is the estimated number of search requests processed by Google each day around the world. Even though 10% of those searches are news, that’s 350 million news-related search queries that Google processes every day. Thus, it is also in Google’s best interest to highlight the news and make an effort to attract users looking to access the news, which it does by including snippets of news articles in the news articles. search results.
If users then flock to Google for information, that also serves to attract advertisers to the service. Such a scenario is more true than ever. As print subscriptions have dwindled, advertisers would see online as the place where people go to get their news and so online is where they stand a better chance of catching their eyes.
You might be wondering if news is always so in demand, so why don’t news websites exploit their position to corner ad revenue? But that’s where the bargaining code comes in. The Australian report concluded that overall, social media websites are more important to news businesses than any individual news businesses to social media businesses. So there is an imbalance in bargaining power between social media and news media companies and that is to the platforms that ads have shifted to.
To illustrate this point, of every $ 100 currently spent by Australian advertisers, $ 49 goes to Google and $ 24 to Facebook, according to the report.
So what does Australian law say?
According to Australian Treasurer Josh Frydenberg, “the code encourages parties to engage in trade negotiations outside the code.” Put simply, it forces Facebook and Google to negotiate a fee with media companies to link or use their news content. But failure to agree on such a fee would expose Internet companies to an obligation.
Additionally, with media companies also complaining about the mysterious algorithms that determine search rankings and visibility on social media sites, Australian law also requires tech companies to notify media companies in advance if they are considering to modify their search algorithm.
How have the Internet giants reacted?
Needless to say, the two major companies primarily affected by the new law – Facebook and Google – have strongly opposed the call to pay news media for content. Google, which threatened to cut its service in Australia, argued that paid companies listed in search results go against the concept of the free internet. Facebook has decided to briefly shut down key government and media pages.
But at least one tech giant has shown support for Australian law. In a blog post, Microsoft Chairman Brad Smith said the company contacted Australian Prime Minister Scott Morrison following Google’s threat to leave the country and promised to abide by the code and provide research services. Smith says Microsoft’s move “had an immediate impact” and, “within 24 hours, Google was on the phone with the Prime Minister, saying they didn’t really want to leave the country after all.”
Either way, Google had already negotiated deals with big local media companies like Rupert Murdoch’s News Corp and Nine Entertainment even before Australian law was passed, while Facebook said after the Code was enacted it was working. on agreements with media companies.
The two Code companies said they were already doing their part for journalism. Facebook cited deals with media organizations in the US and UK while Google suspended its News Showcase feature which it launched in some countries, India being one of them. Experts say these companies’ willingness to strike deals with media companies is as much a sign of their intention to help the struggling industry as it is an attempt to show governments that they are ready to open their stock markets to the media industry without the need to have legislative regulations binding them.
Do other countries have similar laws?
Google has reportedly agreed to pay certain publishers in France when it uses snippets of articles from them in search results, while Canada has announced that it will pass a law to compensate publishers. press for articles published on online platforms. In India, Rajya Sabha MP and former Bihar MP CM Sushil Kumar Modi told the Upper House that the country should also follow Australia’s lead and charge internet companies for media content.
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