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Glitch in the code: Google, Meta, and the fight over news in Canada and Australia

The battle between tech giants and local regulations still carries an international flavour.

Can regulators align? (Volodymyr Hryshchenko/Unsplash)
Can regulators align? (Volodymyr Hryshchenko/Unsplash)

This year, Canada enacted Bill C.18, The Online News Act. The rather perfunctory name for the legislation belies the massive change it embodies. That law would require digital platforms such as Google and Meta to pay news media outlets to host links to their articles. Google and Meta have both strongly opposed the Bill, with Meta turning off news services for Canadian users in the midst of severe wildfires.

Australians watching this stoush unfold will have an eerie sense of deja vu.

In 2021, the Australian government introduced the News Media Bargaining Code, which required platforms including Google and Meta (then Facebook) to pay news media outlets for hosting links to news articles on their sites. This code was enacted to resolve the commercial power imbalance between platforms and news media outlets, and to help improve the sustainability of traditional news media outlets.

The platforms, of course, were opposed to the Australian code. They used the same tactics that we see playing out in Canada. Google argued that the quality of Google Search and YouTube would dramatically decrease if the code passed, while Meta turned off news services for Australians. Following bargaining between the two platforms and the Australian government, the code was enacted into law with considerable concessions that allowed  Google and Meta to make “closed door” deals with news media outlets instead of being designated under the code.

Both the Australian government and the platforms argued that these concessions were a win for them. For the government, the code was considered successful and proof that it could effectively regulate platforms. The 34 deals made between platforms and news media outlets amounted to AU$200 million, showing that platforms were injecting money into traditional news media outlets.

Emboldened by the financial success of the Australian code to traditional news media outlets, more and more countries around the world are considering similar laws.

For Google and Meta, they walked away with the knowledge that they can influence national regulation. That is not necessarily a bad thing. Engagement and collaboration between big tech and governments is essential to creating regulation that achieves better outcomes for both parties and for citizens.

However, the “wins” for the government and the platforms need to be considered carefully.

Though the Australian government has deemed the code successful, it is important to note that the code has not actually been enforced. Because both Google and Meta availed themselves of the amended provisions that allowed them to make deals outside the code, they have never been subjected to it. While the local regulator, the Australian Competition and Consumer Commission, considers that the threat of using the code has had a successful intended effect, it remains to be seen if the platforms will comply with the code or pull news out of Australia in the future.

Canada has taken a hardline approach. While the Australian government engaged with Google and Meta to develop provisions for platforms and traditional media to make deals outside the code, the Canadian government provides no option for designated entities to separately negotiate with traditional media. Under the Canadian law, platforms will be required to pay per link to a news article without room for negotiation. Google has said that the proposed payment structure would expose them to uncapped financial liability, and as such, have decided to remove news links altogether in Canada.

The Canadian government has not backed down. They have condemned the platforms for the refusal to comply and argued that it will continue with the current legislation to ensure that news media outlets are paid fairly by big tech. The stalemate continues.

Emboldened by the financial success of the Australian code to traditional news media outlets, more and more countries around the world are considering similar laws, including the United Kingdom, Indonesia, and Brazil. As these battles go on, the tension between platform providers and national regulation will continue to play out.

In Australia, Meta has already indicated that it is reconsidering resigning deals with news media outlets. As the deals are set to be renegotiated in 2024, it begs the question - will Australia’s “victory” with its News Media Bargaining Code survive beyond the terms of deals done in 2021?

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