The BGA Australia Team, led by Managing Director Michael “Mick” McNeill, wrote an update to clients on Australia’s News Media Bargaining Initiative.

Context

  • The Australian government has announced the News Bargaining Initiative, which penalizes digital platforms if they refuse to enter into commercial agreements with Australian publishers. Under the proposal, the government would impose an annual levy on digital platforms, which would be able to offset the value of commercial agreements against the levy.
  • The “incentive” would apply to large digital platforms operating significant social media or search services, regardless of whether they carry news. The Labor government believes this would close a loophole in the News Bargaining Code, established under the previous government. A threshold of Australian-sourced revenue would determine whether a platform is captured by the regime. The details will be finalized after consultations in early 2025.

Significance

  • Beginning in 2025, the News Bargaining Initiative seeks to create a financial incentive for agreements between digital platforms and news media businesses in Australia. The bargaining incentive includes a charge and an offset mechanism. Platforms that choose not to enter or renew commercial agreements with news publishers will pay the charge. However, those that are party to the agreements will be able to offset their liability. For example, if the government imposes an $11 million charge on a platform and grants a 10 percent “uplift,” the platform will need to strike deals with news publishers worth at least $10 million to avoid paying the charge.
  • In a joint statement, Communications Minister Michelle Rowland and Assistant Minister Stephen Jones said a “strong and diverse news sector is vital for a healthy democracy.” However, the rapid growth of digital platforms has disrupted revenue to Australia’s media sector, threatening the viability of public interest journalism. The ministers said the current code allowed “platforms to avoid their obligations by removing news.”
     

Implications

  • The platforms likely to fall within the AUD 250 million (US$159.5 million) threshold are Google, Alphabet, ByteDance (TikTok) and Meta. Some experts speculate that Apple News and LinkedIn could be captured. Jones said that, based on publicly available data, Elon Musk’s X, formerly known as Twitter, would not generate enough revenue to be charged under the new initiative. Musk strongly opposed the government’s Disinformation and Misinformation Bill, which was abandoned last month due to a lack of Senate support.
  • The News Bargaining Initiative is being developed alongside other reforms impacting digital platforms. These include a new scams-prevention framework, a digital competition regime, privacy reforms and mandatory artificial intelligence (AI) guardrails.

We will continue to keep you updated on developments in Australia as they occur. If you have any comments or questions, please contact BGA Australia Managing Director Michael “Mick” McNeill at mmcneill@bowergroupasia.com.

Best regards,

BGA Australia Team

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Managing Director

Mick is a highly-experienced government relations expert and trusted advisor on consensus building, conflict resolution and legislative developments. He has played an integral role in helping parties achieve desired outcomes in areas of national security, health policy, foreign policy and reputational crisis management, as well as media relations, communications campaigns, immigration and human rights. Mick has two decades’ experience working with government as a media analyst, political adviser and NGO advocacy manager. After a stint serving as an adviser to an Australian senator, Mick took on the role of the locally engaged senior political specialist at the U.S. Embassy in ... Read More