22 Feb Tech Giants: Google & Facebook vs Australia, two different story
The dispute between the Australian government and the two tech giants: Google & Facebook over a law that would make them pay for news content has been spreading like a fire in the jungle and is being keenly watched worldwide. Facebook is going to ban all Australian news content on its platform, which has become a conflict to a whole new level.
According to Rupert Murdoch’s newspapers, it is said: “an act of war”. But it seems the action of Australia’s politicians, which is being an affront toward the principle of net neutrality. Facebook did not only block media news content but also blocked state health websites from its platform. Facebook later said- this was a misunderstanding and lots of these pages are now back online.
On the other side, Google has loomed to step down the Australian market if the new law continues by ruling its relationship with news media content. So, what’s the actual scene behind this battle. Let’s know in detail!
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The reason behind criticizing the move?
Australian Prime Minister Scott Morrison posted a Facebook post- saying that the social media company’s actions to “unfriend Australia” were “as pompous as they were disappointing”. Over the issue, he also said that he was in regular contact with the leaders of other countries and would not be intimidated.
Later on 19 Feb 2020, Australian Prime Minister Scott Morrison raised the issue with Indian Prime Minister Narendra Modi, to discuss the progress of their media platform bill and gain international support over the conflict. On the ban of media news content, Treasurer Josh Frydenberg said that it will have a huge community impact.
Approximately 17 million Australian users visit the social media site each month. Western Australia Premier Mark McGowan blamed Facebook for treating, like a “Dictatorship”. The move was also criticized outside Australia.
Julian Knight, the head of the British parliamentary committee directing the media industry, said that Facebook’s actions to ban media news content were “bullying”. And many others criticized the move accusing Facebook of their actions.
How did we get through?
There have been concerns for a long time about the market dominance of tech giants over news media industries. Google is the most famous and the foremost search engine in the globe, which has been stated by the government as the key utility with the small market competition. And Facebook, which is a great social media platform is considered the key source of news today.
When it comes to the social media news source, Facebook ranked top subsequently YouTube and Facebook Messenger. Australia plans to make tech giants pay for news content according to an inquiry that was launched later in 2018 into the impact of tech giants: Google and Facebook.
Stated this, the regulator urged introducing a code of conduct- saying to level the playing field.
In July 2020, the Australian government revealed a draft law to execute the code, evoking threats from Facebook and Google to eliminate services in the country.
About the draft news code
The draft news code says tech companies pay for content, though the worth is not defined yet. The law would allow news organizations to negotiate the price with tech giants for the content that shows in their search results and news feeds. If it doesn’t apply, the matter could be reconciled by the (ACMA) Australian Communications and Media Authority.
Penalties could cost approximately A$10m (£5m; $7m) per breach or 10% of the company’s local turnover. According to the Australian draft code, it will initially focus on Google and Facebook, but later, it could be unfolded to other tech companies.
Why Australia is initiating this law
The Australian government has claimed that tech giants should pay news organizations a fair amount of money for their news content. They have also demonstrated that they need financial support for Australia’s embattled news industry, thinking that – strong media is key to a democracy.
According to William Easton, a Facebook manager for Australia and New Zealand – argues “the value exchange between Facebook and publishers operates to support publishers and generate a huge amount of revenue in dollars for the media.
Publishers are most likely to post news on Facebook to get more leads, increase subscriptions, grow their audiences, and boost their revenue models faster than any other platform.
As per the AFP news agency – says that each $100 spent on online advertising. Of those, Google captures $53, Facebook takes $28, and the rest is shared among others, taking revenue away from media outlets.
How India is reacting to the move
In India, policymakers have focused on the dominance of arbitrators, such as Google and Facebook, which have become an essential part of any business that no one can’t reach their targeted customers without using these platforms.
According to a FICCI-EY report for 2020, in India, there are approximately 300 million users of online news sites, including portals and aggregators in the country — making 77% of smartphone users and 46% of Internet users by the end of 2019.
With over 282 million unique visitors is considered the second-largest online news consuming nation after China. In India, the people spent on digital advertising has grown up by 24% to Rs 27,900 crore, stated by the EY estimates. And it is expected to grow to Rs 51,340 crore by the end of 2021.
As per the report by Harvard University’s Nieman Lab, publishers were initially used to pay Rs 5-6 lakh monthly to host their content on Dailyhunt. But, they started leaving the platform due to its changing terms & conditions. However, a few news aggregators are mandated to make payments to journalists and startups, such as Dailyhunt.
What to expect next?
The code logically endeavors to discuss the bargaining power unevenness between digital platforms and news agencies in Australia. The law has seemed to catch full political support and has transferred to the lower house of the parliament. If it gets approved through the senate, the designed code will be supposed to review at the end of the year.
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