Why is Australia Pushing Back Against Google and Facebook?
Recent legislative maneuvers by Australia to mandate payments from Facebook and Google to publishers for news content reveal a critical shift in global policy. This move is driven by the need to support news media, which are struggling to maintain profitability in the digital age. By compelling these technology giants to pay for the value they extract from news, Australia aims to strengthen the journalism ecosystem.
Supporting Journalism: A Cornerstone of Society
At its core, supporting journalism is essential for a well-functioning society. The internet has made it increasingly difficult for news outlets to generate revenue, leaving many struggling to sustain their operations. Many government-led initiatives have fallen short, particularly in larger, diverse democratic nations like India. However, as the world’s second-largest online market and soon-to-become a significant economy, India could have taken the lead. Instead, it was Australia that took the initiative.
Legislation in Australia and Its Impact
Australia’s push to make Big Tech pay is embodied in a law set to be passed by its parliament. This legislation imposes payment obligations on Google and Facebook, ensuring that a portion of their advertising revenue from news content is returned to the publishers. The argument is clear: if these companies benefit financially from the content they consume, they should contribute to its sustainability.
India: The Ideal Candidate for Global Leadership
India, a large democracy with a growing internet market and a government that champions self-reliance, has the potential to spearhead this initiative. The Indian government has demonstrated its willingness to challenge Big Tech in other areas, making it an ideal candidate. However, so far, there has been little action. This is despite a clear case for making Big Tech pay more to India’s news content publishers.
The Statistics and Economic Impact
Google and Facebook dominate internet traffic for news. Around 80% of external traffic to news websites comes through Google and Facebook. Additionally, news is a significant source of traffic for these internet giants. Forty percent of trending queries on Google are related to news. This dominance means that these companies take a huge share of advertising revenue from digital news consumption, thereby reducing the revenue available to publishers. As the digital distribution of news grows, the revenue from other distribution models shrinks, hitting publishers hard.
Financial Viability: Protecting the News Industry
The cost of producing credible news hasn’t decreased, making it increasingly difficult for publishers to maintain their businesses. As a result, reputable publishers are struggling and the dissemination of credible news is under threat. A scenario where news is shaped by social media trolls is concerning. Therefore, ensuring that Google and Facebook compensate news publishers fairly can help protect the domestic news industry and ensure it remains financially viable.
Government Action and Market Dynamics
In Australia, news publishers are seeing an increase in revenue due to the legislation. This not only sustains their businesses but also helps to create jobs in the news industry. Additionally, the government benefits from increased tax revenue from the domestic news industry, making it a win for all stakeholders. Other democracies like France, the UK, Germany, and Spain are also taking steps to tackle Big Tech, underscoring the urgency of action.
Strategies for India
India can start by leveraging its current market size and future potential to implement similar regulations. The Competition Commission of India can conduct a suo motu investigation, and the Information and Broadcasting Ministry can initiate a consultation process. Options could include establishing a new digital agency to address issues involving news publishing and adapting existing legislation, such as the Copyright Act, to impose licensing fees for content.
Conclusion
The global environment is now ripe for action against Big Tech’s dominance. As other democracies put pressure on these tech giants, India should not lag behind. Protecting and strengthening the news industry is crucial for a vibrant democracy. By taking decisive action, India can ensure a sustainable future for its media landscape.