Meta, Google and TikTok will have to pay Australian news organisations up to a quarter of a billion dollars for their content, or pay even more to the Government under a new version of laws aimed at making sure tech giants pay their fair share.
Facebook owner Meta, which takes in $1.4 billion annually in Australia, slammed the plan as a “government-mandated transfer of wealth” that would do nothing to strengthen journalism.
It had already walked away from renewing deals originally struck under the first version of the bargaining code, causing the regime to fall apart.
Anthony Albanese unveiled the updated news bargaining incentive on Tuesday.
“Our government is taking the next steps to ensure that Australian journalism is sustainable now and into the future, by ensuring that large digital platforms cannot avoid their obligations under the news media bargaining code,” the Prime Minister said.
But the deal won’t cover the growing sector of AI, nor will it touch LinkedIn despite the networking site having a reported 18 million users in Australia.
It also risks re-angering the Trump administration, which has previously complained about Australian restrictions on American tech companies.
Under the new rules, which the Government will put to Parliament before the end of winter, the tech companies will have to strike deals with media companies, big and small.
It’s anticipated these would be worth between $200 million and $250 million in total.
But if they refuse to pay news companies directly, the tech giants will be on the hook to pay 2.25 per cent of their Australian revenue — roughly $375 million — to the government.
Even if the tech companies pull news content from their sites, as Facebook did in response to the first iteration of the news bargaining code, they will have to pay up, Communications Minister Anika Wells said.
The government would distribute this revenue to media organisations based on how many journalists they employ.
“The more journalists they have, the more money they will get under this proposal,” Ms Wells said.
“A strong and sustainable news sector matters more than ever today, whether it is the national press gallery, whether it’s local radio, or a small regional newspaper. Journalists are the lifeblood of Australian news; we need more of them, not fewer.”
The nation’s major media companies, including Southern Cross Media-Seven West, the publisher of this masthead, issued a joint statement describing the draft laws as a critical step towards securing the future of Australian news.
“The vibrancy of Australian democracy relies on the robust and open exchange of news, views and opinions. This is under threat,” said the joint statement, signed by SCM chief executive Rohan Lund, ABC’s Hugh Marks, News Corp Australasia’s Michael Miller, Nine Entertainment’s Matt Stanton, SBS acting managing director Jane Palfreyman, Network Ten’s Beverley McGarvey, The Guardian Australia’s Rebecca Costello, and Australian Community Media’s Tony Kendall.
Prioritising commercial deals protected Australia’s democratic way of life, they said.
“If digital platforms fail to pay for the use of the news content from which they profit then journalism becomes unsustainable. It is also in the public interest that reliable, professionally created news and information remains accessible and visible on the digital platforms used by millions of Australians.”
Google made more than $2.2 billion in Australia in 2023-24, but only $486 million of this was taxable income.
Facebook made almost $1.4 billion, of which nearly $129 million was taxable income, and TikTok made $376 million with $33 million of that taxable, according to the latest ATO corporate taxation data.
Google currently has agreements with more than 90 news businesses and 226 outlets across Australia.
“While we are currently reviewing the draft legislation, we have been clear: we reject the need for this tax,” a spokesperson for the company said.
“It ignores the fact that Google already has commercial agreements with the news industry, misunderstands how the ad market changed and mandates payments from some companies while arbitrarily excluding platforms like Microsoft, Snapchat and OpenAI – despite the major shift in how people consume news.”
Assistant Treasurer Daniel Mulino said AI companies weren’t included because the Government was looking at other mechanisms to deal with them.
Meta said it was “simply wrong” to say its platforms, including Facebook and Instagram, took news content when media organisations voluntarily posted it.
A spokesperson slammed the plan as “nothing more than a digital services tax” that would only serve to create a media industry dependent on subsidies.
“A government-mandated transfer of wealth from one industry to another, with no connection to the value exchanged, will not deliver a sustainable or innovative news sector,” the Meta spokesperson said.
A draft version of the legislation has been released and will be open for consultation until May 18.
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