Media cash in ahead of laws on tech giants

·3-min read

Facebook is expected to follow Google in striking lucrative lump sum deals with Australian media companies to avoid being stung under world-first laws.

The federal government is on the verge of passing legislation to create the news media bargaining code, which has bipartisan support.

Google has inked agreements with Nine and Seven worth millions of dollars ahead of the code coming into place.

If commercial agreements cannot be reached, the code will act as a safety net, with mandatory arbitration to determine fees for news.

Treasurer Josh Frydenberg said none of the deals would be happening without the mandatory code.

"This is a historic moment - a world first. The digital giants entering into negotiations and agreements with Australian news media businesses to pay for original content," he told reporters in Canberra.

"This will help sustain public interest journalism in this country for years to come."

Mr Frydenberg is convinced Facebook wants to sign similar deals with media firms after discussions with founder Mark Zuckerberg.

"Everything is pointing in the right direction," the treasurer said.

Nine's Google deal is a reported $30 million annually for five years, while it is understood Seven's agreement is worth more than that.

Google is in talks with News Corp, Guardian Australia and public broadcasters ABC and SBS.

The search engine behemoth already has deals with smaller publishers including Australian Community Media, InDaily, Junkee, Solstice and Private Media.

Journalists' union MEAA federal president Marcus Strom said media companies had a moral obligation to put the money towards news gathering.

"Any monies from these deals need to end up in the newsroom, not the boardroom. We will be pressing the case for transparency on how these funds are spent," he said.

Google had threatened to pull out of Australia if the code passed before high-level negotiations with the government.

Tech giants secured an agreement that media companies would receive lump sums rather than be paid per click or page view.

Mr Frydenberg denied the government had bowed to pressure from Google and Facebook.

"We have held the line and held it strongly. The digital giants have been left in no doubt about the Morrison government's resolve," he said.

He said the government wanted to see commercial agreements, the bill passed and technology companies remaining in Australia.

"Everything that I have heard from parties, both in the news media business and in terms of digital platforms, is that these are generous deals, these are fair deals," Mr Frydenberg said.

The code will give the treasurer power to choose which companies are subject to it.

Mr Frydenberg said having commercial agreements would change the equation when he makes determinations.

Under the code, a panel - decided by the negotiating parties or the media watchdog - would hear offers and make a decision on payment for content.

Amendments to the bill also streamline requirements for digital platforms to give advance notice of algorithm changes.

Aside from its major television network, Nine also owns The Age and The Sydney Morning Herald as well as dominant commercial talkback radio stations in major capitals.

Seven controls a major share of the national television market and The West Australian newspaper.