Australia’s Draft News Media Bargaining Code

Abstract

In 2020, the Australian government produced a novel proposal to legislate to require designated digital platforms – initially Google and Facebook – to compensate news media businesses for news content. Although a handful of other jurisdictions had already used copyright regulation to require digital platforms to pay publishers for content, the Australian proposal was for an amendment to competition legislation to require platforms to negotiate with news businesses on remuneration for news content made available on the platforms, including through mediation and, if no agreement can be reached, binding arbitration.

The News Media and Digital Platforms Mandatory Bargaining Code (the ‘Code’) is also intended to set standards on other aspects of the relationship between platforms and news media businesses, including information that the platforms must provide to publishers about the algorithmic ranking of news content and about the data that the platforms collect on users interacting with news content. After the Australian government’s publication of a draft Code in July 2020, Google and Facebook each started marketing campaigns, vigorously opposing the Code.

The proposal for the Code stemmed from recommendations by the Australian Competition and Consumer Commission (ACCC) in its Digital Platforms Inquiry Final Report, after the 18-month Digital Platforms Inquiry (DPI). Conceived as an inquiry to assess the impact of large digital platforms on the revenue of traditional news businesses after changes to Australian cross-media ownership laws, the DPI ultimately assessed the state of competition in a number of sectors in which digital platforms – especially Google and Facebook – operate, and produced wide-ranging recommendations for reform.

This article proceeds as follows. Part II explains the origins of the DPI in the debate over the future of media diversity and journalism in Australia. Part III outlines significant findings made by the ACCC in the DPI Report about the market power enjoyed by Google and Facebook, competitive dynamics between the platforms and news businesses, and the ACCC’s reasoning in initially recommending voluntary codes. Part IV describes events after those recommendations, including the stalled negotiations over a voluntary code and Google and Facebook’s campaigns against the draft Code. Part V outlines and analyses the provisions of the draft mandatory Code, in light of key criticisms. Part VI concludes with comparisons to measures in other jurisdictions and likely outcomes in Australia.

NB: After this article went to print, the Australian government passed the Code with some amendments.

Keywords: Antitrust; Digital platforms; Competition law; Media law; Media bargaining; Advertising; Google; Facebook; Baseball arbitration; Australian competition law; tech giants

JEL Classification: Law and Economics