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While you are reading this, Google and Australian authorities are supposedly negotiating on how the news will look like in the future for the Australian citizens. If you are living in Australia, you may have already read the open letter by Google. Although it may fall under corporate news, it concerns each and every Internet user in Australia. The main stumbling block concerns the news and the treatment of Australian media companies.  Will Australia be the first country to charge Google for news? We thought that you should know the main arguments on both sides to be able to form an opinion.

Things Google Is Concerned About

If you read the letter you could have spotted two main concerns Google Australia is drawing the attention to. One is the fact that if they abide by the rules imposed by the Australian government, this will affect the search results. According to Google, this would mean that a regular user in Australia would be able to see the results the local media outlets want them to see first – thus giving preference to media companies.

The other concern that Google Australia has is that the user search data may be at risk. Namely, according to the proposed code, Google has to tell news media businesses “how they can gain access” to data about your use of Google products.

Consequently, this would hurt the free services the users got so accustomed to, according to Google Australia Managing Director, Ms. Mel Silva.

Concerns from the Australian Side

At the beginning of August, Treasurer Josh Frydenberg commented on the matter saying:

“What we have sought to do (with this code) is create a level playing field to ensure a fair go for Australian news media businesses and that when they generate original content, they are fairly paid for it.”

The code that Mr. Frydenberg referred to is the proposed regulation that stipulates the compensation for the original content coming from the Australian media outlets. The Australian side purportedly believes that this is the way to create sustainable media environment.

NewsCorp Australia has reportedly urged for negotiating with US companies due to the constant drop in revenue from advertising. Additionally, the Australian records from 2019 showed that 3,000 jobs became non-existent in the previous decade in Australia only due to one fact. Namely, the traditional media companies spent their revenue from adds on Google and Facebook – who on other end did not pay for the content they displayed. Mr. Frydenberg also purportedly stated that almost third of the $100 spent on online adds goes to Google and Facebook. In 2019 Google Australia reportedly earned $4.8 billion (including $4.3 billion from digital advertising)

Are There Any Similar Cases Worldwide?

So far, both Google and Facebook have not agreed to this type of a deal anywhere else. There have been talks about Facebook introducing a “news” tab for some 200 publishers. The talks reportedly included the compensation for the original content. However, this plan is yet to unfold.

Google also reportedly negotiated with publishers from Australia, Brazil and Germany for their “premium content”. We will see how that goes. More news is expected at the end of August.

Do you think Google should pay Australian publishers for original content? Or should we consider the platform as open as possible and let the market defines the values?

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