Australia Blames Big Tech For Job Loss In Journalism and Demanding Payment

Australia Fights Google and Facebook

“Nothing less than the future of the Australian media landscape is at stake.”

Australia aims to compel U.S. tech giants Facebook Inc (FB.O) and Alphabet Inc (GOOGL.O) Google to pay for news content on Australian media outlets in a historic attempt to promote independent journalism that will be watched around the world.

Australia will become the first country to demand that Facebook and Google pay for media companies’ news content under a royalty-style scheme that will become law this year, Treasurer Josh Frydenberg said.

The move comes as the tech giants fend off calls around the world for stronger control, and in a congressional hearing a day after Google and Facebook faced a battering from U.S. lawmakers for alleged misuse of market power.

Following an investigation into the state of the media industry and the dominance of the U.S. networks, late last year the Australian government ordered Facebook and Google to strike a cooperative agreement with media companies to use its content.

“It sends a concern message to companies and investors that instead of letting the market operate, the Australian government will interfere,” said Mel Silva, Google Australia and New Zealand’s managing director, in a statement.

“It doesn’t address the basic challenges of building a business model suitable for the modern age.”

Media companies including News Corp Australia, a Rupert Murdoch’s News Corp (NWSA.O) subsidiary, campaigned hard for the government to compel U.S. businesses to bargain in the midst of a long decline in advertising revenues. (Is) taking world-first steps, “said Michael Miller, chief executive of News Corp Australia, in a statement.

A 2019 report estimated to have lost some 3,000 journalistic jobs in Australia over the past 10 years, as conventional media outlets bled advertising revenue to Google and Facebook that paid little for news content.

Publishers in Germany, France , and Spain have forced through national copyright laws that force Google to pay licensing fees when publishing news articles excerpts.

In 2019, Google stopped showing news snippets from European publishers on search results for its French users while Germany’s largest news publisher, Axel Springer, allowed the search engine to run snippets of its articles after traffic to its pages to plunge.