In case you hadn't noticed, Google and Facebook are large and quite powerful. They collect your data, bundle it together into juicy advertising fodder and make a squillion bucks. Somewhere along the way they've also become an indispensable source of traffic to news websites.
News publishers have been grappling with their revenue models for a long time. Their existential need for advertising revenue doesn't always sit comfortably with their social purpose of disseminating information and holding governments accountable for their actions.
According to the ACCC, around half of the traffic to news websites comes via Google or Facebook. That makes the news outlets a bit queasy. They have no control and little visibility of the algorithms that decide whether to serve up their story or someone else's in any given search results or social feed. But in order to maintain their traffic (and their financial viability) they are compelled to produce content that they *think* will rate highly on the digital platforms.
The ACCC had a close look at this relationship of utter dependency in its Digital Platforms Inquiry. It couldn't find a competition law breach. Its best call was that there was an imbalance in bargaining power. That has no direct legal consequence. It's not really a thing.
That being the case, the ACCC tried to get Google and Facebook to play nicely with the news outlets and agree on a voluntary code to govern their dealings. Apparently that didn't work. Now, the Federal Government has tasked the ACCC with developing a mandatory code instead. They want it to cover data sharing, ranking and display of news content and the monetisation and sharing of revenue generated from news.
This will be hotly contested. Google and Facebook aren't going to give up anything about their algorithms without a fight. And attempts to make Google pay for news snippets in its search results in the EU have been problematic at best. When Spain tried it on, Google just switched off the news function in search. Because it can. In Germany, news outlets relented and gave Google permission to show news snippets after some publishers saw their website traffic nearly halve. (We wrote about it here.)
This mandatory code carries similar risk. The government wants to rein in the big digital platforms and help out the news publishers. But if it goes too far, Google and Facebook can opt out by cutting off news referrals altogether. It's a fine line to tread. Maybe the press aren't the only ones experiencing an imbalance in bargaining power.
If the ACCC truly wants to control the likes of Google and Facebook, it could instead look to the access to services regime in the Competition and Consumer Act. It allows for mandated access, and access terms, for 'facilities' by which an essential service is provided. Facilities are physical assets like telco infrastructure, airport runways and railways. What if a facility could also include virtual infrastructure? What if Google and Facebook's news referral services were classed as essential facilities by which news publishing services were provided? That would require a reconfiguration of the current regime, but perhaps the everincreasing power of digital platforms would make it worthwhile.
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