How Google and Facebook could pay for news: Competition watchdog sets out options for publishers, including a ‘collective boycott’
The competition watchdog has laid out potential frameworks and models which would enable news publishers to be compensated by the likes of Facebook and Google for the use of their content.
A concepts paper released this morning sets out various potential methods for levelling the playing field between local publishers and the global tech giants.
Perhaps the most radical potential course of action put forward by the Australian Competition and Consumer Commission (ACCC) is a ‘collective boycott’ which “may encourage each of Google and Facebook to offer news media businesses more appropriate remuneration for the use of their content”.
This, however, relies on the big publishers being involved and sticking to their guns.
“A level of compulsory participation in this collective boycott is likely necessary for this mechanism to be effective, as without the participation of all (or at least a majority) of prominent news media businesses, each platform may circumvent the collective boycott by reaching agreements individually with one or two large publishers, undermining the bargaining power of the remaining group,” the paper conceded.
It did note as well the damaging effects this could have on the publishers themselves and consumers seeking news and information.
The ACCC reiterated that mandatory news media bargaining code – which was announced by Treasurer Josh Frydenberg last month – is about levelling the playing field.
“The aim of the code is to address the bargaining power imbalance by facilitating commercials negotiators that will allow news media businesses to achieve outcomes consistent with those that would be achieved in the absence of the bargaining power imbalance,” the concepts paper said.
A less dramatic suggestion put forward in the paper is for news media businesses to come together to allow for collective bargaining.
Whilst this would somewhat level the playing field, and give publishers more might against Google and Facebook, the watchdog conceded this approach also had its flaws.
“Given the diversity of the Australian news media industry, including the wide range of business models and funding mechanisms employed by these businesses, and the varying approaches they take to distributing news through each of Google and Facebook, a collective bargaining approach may not meet the commercial needs of some news media businesses,” the issues paper said.
It also noted collective bargaining can be anti-competitive and there needs to be a public benefit to justify its use.
Instead, collective licensing or fee arrangements could be pursued, which would have fixed fees for the use of news content. This would not change local copyright laws, the ACCC said.
A fourth suggestion put forward in the paper is bilateral negotiation, mediation or arbitration, with the ACCC seeking views on whether the code should be silent on how negotiations are conducted , or prescriptive about how they take place. In addition, the watchdog is weighing up whether to require the parties negotiate “in good faith”, and if it should put a time limit on negotiations.
It noted that the walled-gardens of the digital giants could make it difficult for publishers to negotiate, as the information they require may not be readily available.
“Any bargaining framework set out in the bargaining code may also be supported by mechanisms addressing information asymmetries between the parties, such as information asymmetries regarding the value that Facebook and Google derive from the availability of news on digital platforms. In particular, it is currently very difficult for news media businesses to ascertain the value (especially the indirect value) that each of Google and Facebook derive from the use of news on their services,” the paper explained.
“The availability of this information may in itself place news media businesses in a stronger bargaining position when negotiating with each of Google and Facebook,” it said, noting that calculating the indirect value that news provides is likely to be “highly complex and contestable”.
The competition watchdog is also seeking feedback on if mediation or arbitration is the best way forward. In particular, it wanted feedback and suggestions to assist in the identification and potential appointment of an arbitrator that is independent, has necessary information-gathering powers, and has experience in resolving disputes through arbitration.
In addition, the paper explored whether the digital giants should share consumer data with news publishers.
“As noted in the DPI Final Report, consumers would not expect a news media business to have access to their broader browsing history, search queries or navigational history as a result of simply visiting the news media business’ website,” the ACCC said.
“However, as digital platforms obtain a benefit from the data they collect due to users’ interactions with news content published or distributed on their services, it may be reasonable for digital platforms to share this data with relevant news media businesses.”
For many publishers, however, the concept of ‘You don’t know what you don’t know’ factors into their inability to negotiate with the tech giants here. As the ACCC pointed out, the publishers don’t even know what to look for, or what to ask for.
“The majority of large news media businesses and some smaller digital natives have raised access to user data as an important issue to be covered in a bargaining code. However, some smaller news media businesses, including local and regional publishers, have put less emphasis on addressing data sharing through the code. Other news media organisations have provided general feedback that they would like access to more user data from Google and Facebook, but most have indicated that they do not fully understand the extent and nature of the data that Google and Facebook hold on users’ movement between digital platforms and news media businesses’ websites, and do not know what types of data would be valuable for them to request.”
The paper also explores how the tech giants could notify publishers about algorithm changes in advance, the treatment of paywalled content, and the prioritisation of original news content.
The ACCC is seeking feedback on its suggestions, with feedback due by 5 June.
Collective boycott – I just fell on the floor laughing.
What if Google and Facebook stop indexing news from Australia or allowing posting of links to Aussie news companies? They’d be absolutely screwed.
I have ordered a lorry load of popcorn, this will be hilarious.
Also ordered some more sanitiser as my head will likely be in my hands a lot of the time.
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If the Major Media companies believe that:
1. The Tech Platforms drive Ad Revenue by attracting Users to their site by offering both SEARCH and NEWS links to their CONTENT and
2. There is no VALUE to them in receiving the Users / Audience to their site that come through this avenue (instead of coming ‘Direct’ and thru other affiliated / organised means)
…then the simplest solution would be:
1. To get the Tech Platforms to EXCLUDE all SEARCH and NEWS results for any Media Publisher who wishes to be excluded
2. Self-opted-out Media Publishers to build their direct audiences further and NOT receive any compensation from the Tech Platforms
3. ANY Media Publisher (no matter what size) that DOES see value in having their content included in SEARCH and NEWS results would automatically still be included in the Tech Platforms offering
This logic belies the claim from Mainstream Media Publishers that the Tech Platforms should help fund their ‘quality’ journalism because they are profiting from it. The above solution takes this ‘profiting’ away from the Tech Platforms – and will leave the Mainstream Publishers with smaller audiences (in the medium term) AND still the same issues of trying to compete against the Tech Platforms for online Ad Revenue……
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Agreed – As much as I want a strong local media, I can’t for the life of me see what the endgame for publishers is. If the endgame is that the government decides to enforce fee-for-content, watch how quickly local publishers die once their domains are no longer indexed.
Given the ridiculousness of these proposals, I’m surprised they didn’t include an additional one: maybe the publishers should engage in collective content warfare and saturate the country with opinion pieces claiming Bing is superior to Google…?
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This is a complete nonsense – if you boycott google that people will get news from overseas. Internet is a delicate ecosystem of relationships and regulating on the scale of Australia is going to be near impossible. What we need to recognize as an industry – consumption of news has drastically changed in its nature and publishing need to expedite its evolution.
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It’s extraordinary how this process has gone off the rails. How can you spend so much time and money trying to understand an industry, and then get it so fundamentally wrong.
It’s clear that Google & FB have extrordinary powers, and outdated rules and regulations aren’t working. However, to fundamentally misundertand how the internet works and try to force through misguided ideas, who’s only common thread is advantaging a small number of major media players in the country, is crazy.
Is this the competition regulator telling competitors to form a cartel and collectively bargain?
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agree 100% @Anonymous
This tired old argument from publishers that Google and FB should be paying them for links has been doing the rounds for years, and the logic behind it is as flawed now as it has always been. Publishers need FB and Google (for the very significant traffic they send which Pubs can then monetise) far more than the tech platforms need them or their content. It would make more sense for the tech platforms to be charging Publishers for the traffic they send them — just as they charge advertisers for traffic.
If Publishers really feel their content is so valuable to the tech platforms, then It would be very easy to effectively withhold their content/headlines/links from these platforms by blocking Google from indexing their sites, and by not posting links to their content on FB. It would be a minor blip for G and FB, but would have a massive negative impact on the publishers.
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@anonymous when you say “they’d be absolutely screwed” you mean the traditional “news” outlets, right?
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Yes, the news outlets. I think ALL of them willingly use Google Ad Manager and Google Analytics 360 so it would be interesting to watch them transition temporarily off those to, er, whatever!
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Agree with comments. Seems clear that the proponents of these options from media, government and competition watchdog have a serious lack of digital and SEO literacy?
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