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Google and Facebook are rapidly trying to reach an agreement with Australian publishers, offering them the most generous license terms in the world in an attempt to persuade Canberra not to apply rules that force technology groups to pay for news.
MPs on Wednesday began debating legislation to introduce the code of negotiation for news media, which the EU, UK and Canada are considering as a model for similar regulations to support publishers in their own jurisdictions.
While Google has licensing agreements of more than a million million with publishers in nearly a dozen countries, people involved in negotiations told the Financial Times that the amounts now being discussed in Australia are a multiple of the size of the agreements .
Developments in Australia are being closely monitored in Europe and the US for evidence that the stricter approach will restore the balance between publishers and technology platforms. The code includes an arbitration system that will make binding decisions on the fees that Facebook and Google will have to pay to news providers if commercial negotiations fail.
Google on Wednesday signed a letter of intent with Nine Entertainment, one of Australia’s largest media groups, setting out a draft agreement to use content from its newspaper, television and internet assets, according to a person familiar with the matter. with the agreement.
The tech group said on Wednesday that it had also entered into an agreement with Junkee Media to compile the content of the small online publisher on the recently launched News Showcase service.
On Monday, they followed a similar agreement with Seven West Media, a group with TV, newspaper and digital assets, which according to Australian media received A $ 10 to A $ 30 million ($ 7.7 million to $ 23 million) per is worth years. By comparison, Google’s recent framework agreement in France with more than 100 publishers totals about € 22 million ($ 26.5 million) per year, according to people familiar with the deal.
According to people with knowledge of the negotiations, Rupert Murdoch’s News Corp and Google are also in talks about a potential global content agreement.
Experts said the commitments reflected Google’s desire to ensure that Canberra did not apply the most difficult elements of the code to its core search function, which warned the US group that it could be forced into Australia.
‘Google is desperate not to pay for news delivered by their search engine. They seem to pay above and beyond market value to secure transactions that specifically exclude Google Search, ” said James Meese, a communications lecturer at RMIT University in Melbourne.
Canberra and Google are likely to reach a kind of ‘tacit agreement’, he added, whereby the government will not apply the code to the technology giant’s search function if it signs enough deals with publishers.
Josh Frydenberg, the treasurer of Australia, said that none of the commercial transactions would be closed without the code, which ushered in a ‘historic moment’ for news outlets. The legislation would be introduced by parliament, but the government would decide whether to apply it to Google’s search service or Facebook, he said.
“As for the designation of Google Search or Facebook, these are decisions I will make after receiving the advice” from the Australian competition regulator, he told Sky. “But if there are commercial transactions, it becomes a different comparison for me.”
Google and Facebook have not released details on how much the deals with publishers are worth, but they are not expected to reach the AU $ 1 billion a year that News Corp indicates that the technology groups owe Australian media owners.
Google pledged $ 1 billion over three years to pay global publishers last year, saying it had agreed to 450 “news partners.”
Facebook has made less progress in signing deals with publishers, though it remains in negotiations, said people directly familiar with the matter.
The Sydney Morning Herald, the Nine newspaper that first reported the draft agreement between Google and its parent, said it would be worth more than AU $ 30 million a year.
Additional reporting by Richard Waters in San Francisco and Alex Barker in London.
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