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    Explained: Why Australia is waging a war against Google and Facebook

    Explained: Why Australia is waging a war against Google and Facebook

    Explained: Why Australia is waging a war against Google and Facebook
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    By CNBC-TV18  IST (Published)

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    On January 22, Google had threatened to block its search engine in Australia if the government went ahead with plans to make internet companies pay for news content. However, barely a month later, the tech giant has announced agreements to pay publishers in Australia.

    On January 22, Google had threatened to block its search engine in Australia if the government went ahead with plans to make internet companies pay for news content. However, barely a month later, the tech giant has announced agreements to pay publishers in Australia. Meanwhile, Facebook Inc., which was the other company that was to come under the pay-for-sharing-links rule, has blocked Australian users from viewing or sharing news.
    What law has the Australian government proposed?
    News Media and Digital Platforms Mandatory Bargaining Code, a new legislation proposed by the government, aims at compensating publishers and broadcasters for the value generated by their content. However, if both parties can't reach a mutually agreed upon decision with regard to payment negotiations, a government-appointed arbitrator will ultimately take a call on the price. Google and Facebook opposed the proposed law, with the former calling the payment model for showing news links in search results as “unworkable”.
    So, what has changed now?
    Google has cut a deal with Rupert Murdoch’s News Corp for a ‘significant’ amount for content from news sites across its media empire, but financial details have not been disclosed yet. With this, Google will continue to provide its services in Australia.
    Negotiations with the Australian Broadcasting Corp are said to be in progress.
    Facebook, however, has refused to budge and in fact, has started preventing internet users from accessing and sharing news links from Australian publishers.
    Is Australia the only country making tech giants pay news outlets and publishers?
    Australia is the first to come out with such a law, but other countries are also considering following the model. A new European Union rule on copyright suggests that search engines and news aggregators must pay news outlets for links.
    Last year, Google carried out negotiations with certain French publishers after a court upheld an order that stated such agreements were mandated by the copyright directive. France was the first EU nation to bring the rules into effect, but the court decision suggested Google, Facebook and other internet companies will have to meet similar requirements in other parts of the 27-nation trade bloc.
    In 2020, Facebook had announced that it would pay US news organisations such as The Wall Street Journal, The Washington Post and USA Today for the news headlines, but the payment part was not disclosed.
    In Spain, Google shut down its services after a law passed in 2014 required it to pay publishers.
    What’s next and what does it mean for internet users?
    The Australian law has wide-ranging political support with the Parliament’s lower house passing it. If it gets through the Senate, the code will be up for review after a year.
    Google’s deal with News Corp will translate into a new means of revenue stream for news outlets. The union for Australian journalists has beckoned media companies to ensure that the revenue is put into gathering news. But there is no clarity on whether the additional revenue will lead to more coverage for users.
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