Background and Implications of Australia’s News Media Bargaining Code

The rapid growth of digital platforms has had a profound impact on various stakeholders such as consumers, news creators, and advertisers. The information and services they provide deliver significant benefits and, as shown in the third ACCC Digital Platforms Survey, Google continues to be the dominant search engine in Australia, which can be seen as a recognition of Google as a digital platform by Australian consumers and businesses. But the aim of the ACCC is not just to confirm their superiority, but to examine the fuller impact of digital platforms on stakeholders, such as their use of individual consumer data, the way news and information is delivered, and their reliability.

According to the final report of the 2019 ACCC Inquiry, one of the issues it exposes is the imbalance of market power between news media companies and digital platforms. This has led to a reduction in the number of practitioners and related businesses in public journalism in Australia, with the total number of newspapers falling by 15 per cent and the number of journalists employed by 9 per cent. This will further reduce media diversity, creating a ‘news desert’ with democratic implications, while increasing the frequency of ‘fake news’ to which users are exposed. While digital platform companies have attempted to self-regulate through democratic organizations, self-regulation has had limited effect as the market size and social influence of digital platforms have grown. Following the release of the ACCC report, the Australian Government moved from a reactive regulatory model to specific interventions around the governance of digital media platforms.

The Australian Federal Government enacted the NMBC in 2021, claiming it to be a ‘world-first’ piece of legislation. The guidelines will facilitate negotiations between eligible news organizations, individually and collectively, with Google and Facebook to negotiate payment for news content, with an independent arbitration panel determining payment if no agreement can be reached. NMBC sets out its objective to support public interest journalism in Australia by addressing the power imbalance between digital platforms and news organizations in the production and dissemination of news and information.

According to the investigation report of Bossio and Barnet, the legislation facilitated approximately $200 million in transaction agreements, and although it was not enforced, while other transaction amounts were not disclosed, the policy objective of harmonizing power imbalances was to some extent met in the report.

However, the question of whether the goal of whether public interest journalism is supported is met deserves further discussion. The Australian Federal Treasury released a review in 2022 (i.e. one year after the guidelines were introduced) which claimed that the focus of the legislation was on addressing market imbalances rather than supporting public interest journalism. Meanwhile the push for the guidelines has seen the unintended consequence of digital talent being poached by established news organizations. The emergence of these situations also reflects the fact that digital platforms and news organizations cannot be completely separated or opposed, and how news organizations can adapt and pursue their own development in the dynamically evolving industry environment of digital platforms needs to be discussed in depth.