Context: Australia’s Prime Minister Scott Morrison has spoken to Indian Prime Minister on Australia’s media platform bill.
- Australia has launched a global diplomatic offensive to gather support for Australia’s proposed law to force Internet giants Facebook and Google to pay media companies for the news content that is published on their platforms.
- The proposed law, News Media and Digital Platforms Mandatory Bargaining Code Bill 2020, mandates a bargaining code that aims to force Google and Facebook to compensate media companies for using their content.
- Issue between major digital platforms and media businesses:
- It envisaged limiting tech platforms from introducing algorithm changes that affected how a particular publisher’s news is consumed, and notifying these changes to the publishers.
- The provision requires Google and Facebook to enter into payment negotiations with media companies.
- This opens up the possibility of disrupting the level playing field between small and large news organisations.
The core issue: Competition between traditional news outlets and tech platforms
- It is about how much control these companies would be able to retain on their payout process and having to reveal changes in their algorithms.
- European authorities have specifically linked payments to copyright, without putting a forcing device into the agreements.
- Australia’s code, on the other hand, is almost entirely focused on the bargaining power of news outlets with the tech majors, and has some coercive features as well.
Response from tech companies:
- Google threatened to remove its search engine from Australia.
- But Facebook retaliated with a news blackout, blocking all news links on its platform.
- Blocking emergency services: It removed posts from Australia’s Bureau of Meteorology, state health departments, fire and rescue services, charities, and emergency and crisis services.
- The basic argument of both companies is that the media industry was already benefiting from traffic routed to them by the digital platforms.
- The proposed rules would expose the Internet companies to “unmanageable levels of financial and operational risk.
Scenario in India
- India is the second largest online news consuming nation after China. It has 282 million unique visitors,
- In India, digital advertising spends in 2019 grew 24% year-on-year to Rs 27,900 crore.
- They are expected to grow to Rs 51,340 crore by 2022.
- In India news aggregators are not mandated to make payments to publishers.
- Dailyhunt and InShorts are the other major news aggregators in India.
- Publishers were initially paid Rs 5-6 lakh monthly for content hosted on Dailyhunt but they started to go off the platform after these terms were changed.
- Startups such as Dailyhunt and InShorts are yet to find a sustainable revenue model.