Mandatory code will force social and search platforms to share Australian ad revenues

Facebook and Google will be forced to share ad revenues with Australian media companies after the Australian treasurer, Josh Frydenberg, instructed the competition watchdog to develop a mandatory code of conduct for the digital tech giants amid a steep decline in advertising, the Guardian reports.
In its response to the landmark digital platforms inquiry in December, the federal government asked the Australian Competition and Consumer Commission (ACCC) to develop a voluntary code between media companies and digital platforms including Google and Facebook.

The code was intended to require the companies to negotiate in good faith on how to pay news media for use of their content; advise news media in advance of algorithm changes that would affect content rankings; favour original source news content in search page results, and share data with media companies.

The code was originally due to be finalised in November 2020, but after limited success in early negotiations between the platforms and the news industry, couple with a sharp decline in ad revenue caused by COVID-19, the government has now asked the ACCC to produce a mandatory code.
It will include penalties and binding dispute resolution mechanisms for negotiations between the digital platforms and news businesses. It will also define news content that would be covered by the code, and will cover other tech platforms, including Instagram and Twitter.

A draft code is due to be ready by the end of July, with final version settled on soon after.

Australian communications minister Paul Fletcher told the Guardian: “Digital platforms have fundamentally changed the way that media content is produced, distributed and consumed. Digital platforms need to do more to improve the transparency of their operations for news media providers as they have a significant impact on the capacity of news media organisations to build and maintain an audience and derive resources from the media content they produce.”

And after Facebook said it was disappointed by the move, Frydenberg saidthe Australian government “won’t bow to … threats” from the big tech companies not to show local content, describing the expected row with Google and Facebook as a “battle worth fighting”.