EXPLICER: What’s going on between Google, Facebook and Australia?

For two decades, global news outlets have complained that Internet companies are getting rich at their own expense by selling advertising linked to their relationships without sharing revenue.

Now, Australia joins France and other governments to push Google, Facebook, and other internet giants to pay. This could funnel more money to a news industry that is cutting coverage with shrinking revenue. But it also creates a confrontation with some of the biggest names in the tech industry.

Google, a unit of Alphabet Inc., has announced deals to pay publishers in Australia in the meantime Facebook said Thursday that it has blocked users in the country from view or share news.

WHAT HAPPENS IN AUSTRALIA?

Faced with a bill to force internet companies to pay for news outlets, Google announced deals with Rupert Murdoch’s News Corp. and Seven West Media. No financial details were released. Australian Broadcasting Corp. is in talks. Google accounts for 53% of Australia’s online advertising revenue and Facebook 23 percent, according to treasurer Josh Frydenberg. Google had threatened to make its search engine unavailable in Australia in response to the legislation, which would have created a panel to make pricing decisions on news. On Thursday, Facebook responded by blocking users from access and share Australian news.

Facebook he said the bill “ignores the reality” of his relationship with publishers who use his service to “share news content.” This is despite Frydenberg saying this week Google and Facebook “I want to enter into these trade deals.” WHAT HAPPENS IN OTHER COUNTRIES? The Australian bill would be the first of its kind, but other governments are also lobbying Google, Facebook, and other Internet companies to pay for the news and other publishers for the material. In Europe, Google had to negotiate with French publishers after a court last year upheld a ruling that such deals were required by a 2019 European Union copyright directive.

France is the first government to enforce the rules, but the decision suggests Google, Facebook, and other companies will face similar requirements elsewhere in the 27-nation trading bloc. Google and a group of French publishers have announced a framework agreement for the American company to negotiate licensing agreements with individual publishers. The company operates outlets including the newspaper Le Monde and the weekly l’Obs. Last year, Facebook announced it would pay for US news outlets, including The Wall Street Journal, The Washington Post, and USA Today. No financial details were released. In Spain, Google shut down its news website after a 2014 law required it to pay publishers.

WHY IS THIS IMPORTANT?

Developments in Australia and Europe suggest that the financial balance between multibillion-dollar internet companies and news organizations could change.

Australia is responding to complaints that internet companies should share advertising and other revenue related to news, magazine articles and other content that appears on their websites or is shared by users. The government took action after its competition regulator unsuccessfully attempted to negotiate a voluntary payment plan with Google. The proposed law would create a panel to make binding news pricing decisions to help give individual publishers greater negotiating leverage with global internet companies.

WHAT DOES IT MEAN FOR THE PUBLIC?

Google’s deal means a new revenue stream for news broadcasts, but it’s unclear whether that translates into increased reach for readers, viewers and listeners.

Australian Journalists’ Union is asking media companies to make sure online revenue goes to news gathering.

“Any money from these deals have to go to the newsroom, not the boardroom, ”said Marcus Strom, president of the Media, Entertainment and Arts Alliance. “We will lobby for transparency on how these funds are spent.” Meanwhile, occasional access could suffer: Facebook Thursday’s move initially blocked some Australian commercial and government communications pages.

(This story was not edited by our team of editors and is generated from a feed.)

News Highlights:

  • For two decades, global news outlets have complained that internet companies are getting rich at their expense by selling advertising linked to their relationships without sharing revenue. Now, Australia joins France and other governments to push Google, Facebook and other Internet giants to pay.
  • EXPLICER: What’s going on between Google, Facebook and Australia?