News Media Bargaining Code: Google & YouTube threatened in Australia


Google warns Aussies as the new media code “will hurt how Australians use Google Search and YouTube”.

An open letter was proposed by Google on the 17th of August, 2020, and pop-ups have begun to appear on Google and YouTube’s home pages.

Mel Silva, the Managing Director of Google Australia, said in the letter that the News Media Bargaining Code, which was introduced in April 2020 by the Australian Competition & Consumer Commission (ACCC) and released for public consultation last month, “will put the free services you use at risk in Australia”.

In this letter, Mel strongly argues that the new media code would force Google to provide users’ information and search data to news media companies and it could “artificially inflate their ranking over everyone else, even when someone else provides a better result”. She also fears that once the new media code is implemented, it would severely damage the users’ experience as “the law is set up to give big media companies special treatment and to encourage them to make enormous and unreasonable demands that would put our free services at risk”.

At the end of the letter, she reiterates that Google is standing strong on protecting Search and YouTube’s environment and encourages readers to support their statement.

Google’s blow-back against the new law is readily expected, as the implementation of this new code could bring an immense burden of expense into their annual balance, even though they have already built great fortunes out of aggregating news content. If the mandatory code of conduct commences, an estimated cost of around $600 million a year would be paid into Australian news companies to compensate for the support of journalism, according to Nine chairman and former federal treasurer Peter Costello. Mel on the other hand, retaliates in the open letter that the code neglects the values Google has offered to Australian news media businesses such as licensed content and billions of free clicks.

Whether Google’s dissent is up to the public’s good, it is undisputed that the world’s orders have become significantly concerned about the monopolistic nature of these tech giants who are in full dominance of market power and their “free-riding” behavior. Back in late 2017, the ACCC had already initiated a digital platform inquiry to examine the potential impact that the digital platform providers such as Facebook and Google are having on Australia’s media and advertising landscape. The final inquiry report released in mid 2019 further reassures the digital platforms to be adversely impacting everything from media competition, monetization and journalism quality, through to consumer data, privacy and digital industry competition.   

The News Media Bargaining Code is thus extrapolated at the behest of Australia federal government’s final judgment in order to balance the bargaining power between Australian news media and digital platforms, specifically Facebook and Google, in hopes for a “fair” payment when news content is shown on their respective platforms.

Under the code, the mentioned digital platforms would have to provide a mandatory negotiating procedure with Australia’s media organization, either individually or collectively, to “best facilitate genuine commercial bargaining between parties, allowing commercially negotiated outcomes suited to different business models used by Australian news media businesses”. And if the firms have not come to an agreement in three months of negotiation, news media can elect to commence ‘final offer arbitration’ in hopes to seek a reasonable offer for both parties. 

There will be minimum standards that the digital platforms are obligated to abide by for the sake of “bargaining in good faith” should the code be passed. Under these standards, the digital platforms are required to provide news media businesses at least 28 days’ notice of algorithm changes that are “likely to materially affect referral traffic to news”, and “designed to affect ranking of news behind paywalls”. They are also required to “give news media businesses clear information about the nature and availability of user data collected through users’ interactions with news on their services”.

The code then further addresses the matter of data and users’ privacy. It indicates that the code would not breach any privacy protections that currently apply to digital platforms users as the code “does not include any requirements for digital platforms to increase sharing of user data with news media business.” In addition, it demands the digital platforms to provide news media businesses concrete details of depiction of the data they collected on users’ interaction with news content on their services.

The News Media Bargaining Code is now on draft legislation with a public consultation process, and it is expected to be finalized at the end of August.


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