May 10, 2021

Volume XI, Number 130


May 10, 2021

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May 07, 2021

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No News is Good News . . . Not Always!

The Commonwealth Government is proposing to introduce a controversial new mandatory code that intends to regulate digital platforms and their distribution of news content.

The Government is seeking to address the alleged bargaining power imbalances between Australia news media entities and digital platforms, such as Google and YouTube. However, it has received significant backlash from both Google and Facebook for a start.

Mel Silva, Managing Director of Google Australia, has penned an Open Letter indicating that the code will result in a “dramatically worse” service, and Facebook has threatened to block Australian users from sharing news on its site in response to the proposed code.

The proposed code arose in response to findings from the Digital Platforms Inquiry conducted by the Australian Competition and Consumer Commission, which cited a number of concerns drawing from the alleged inability of Australian news businesses to negotiate more favourable terms with digital platforms such as Google and Facebook.

The draft Mandatory Bargaining Code, released on 31 July 2020, will require Google and Facebook to give news outlets a cut of their digital advertising revenue, essentially paying for news at a price set by news publishers.

Google has also indicated that the Code has the potential for further adverse effects against digital platforms. For Google specifically, these include:

  • Implementation of “minimum standards”. This will require the advance notification of algorithm changes and of “non-discrimination requirements”. Preventing the disadvantaging of the news content of Australian news businesses may in fact actually result in giving an unfair advantage to any other business that has a website, by enabling them to “inflate” their priority over non news-media businesses, which is likely to change Google search results.  
  • The “bargaining rules” facilitated by the code may result in big media companies receiving “special treatment” and facilitate “enormous and unreasonable demands” that, as a result of payments Google will be required to make to media companies, may then result in the free services that Google provides to its users becoming uneconomical.

We are keen to see if the Government will address these potential adverse effects in addition to the concerns from the big digital players.

Copyright 2021 K & L GatesNational Law Review, Volume X, Number 247



About this Author

Cameron Abbott, Technology, Attorney, Australia, corporate, KL Gates Law Firm

Mr. Abbott is a corporate lawyer who focuses on technology, telecommunications and broadcasting transactions. He assists corporations and vendors in managing their technology requirements and contracts, particularly large outsourcing and technology procurements issues including licensing terms for SAP and Oracle and major system integration transactions.

Mr. Abbott partners with his clients to ensure market leading solutions are implemented in to their businesses. He concentrates on managing and negotiating complex technology solutions, which...

Senior Attorney

Ms. Aggromito is a senior lawyer in the lawyer in the Melbourne commercial technology and sourcing team focusing on IT, privacy and data protection.

Max Evans Lawyer technology matters, Software as a Service Agreements SaaS Sydney

Mr. Evans is a corporate and transactional lawyer with a focus on information technology and outsourcing. He provides assistance on a broad range of technology matters, including Software as a Service Agreements (SaaS), terms and conditions for software products and platforms as well as software procurement and outsourcing projects. Mr. Evans also provides assistance with technology and privacy aspects of mergers and acquisitions transactions.

Professional Background

Prior to joining K&L Gates, Mr. Evans worked in the insolvency and bankruptcy practice of...