Michelle Rowland (Greenway, Australian Labor Party, Shadow Minister for Communications) Share this | Hansard source

The Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2020 establishes a mandatory code of conduct to help support the sustainability of the Australian news media sector by addressing bargaining power imbalances between digital platforms and Australian news businesses. The proposed code has been over three years in the making, spearheaded by the ACCC through its Digital Platforms Inquiry. It represents Australia's attempt to address the decline in public interest journalism by capturing news media revenue from dominant digital platforms, as other jurisdictions have attempted to do with varying degrees of success.

From the outset, Labor has indicated in-principle support for a workable code to address the bargaining imbalance between dominant digital platforms and the news media. When the government first announced it would move to legislate a mandatory code in April last year, Labor said, 'Australian media companies must get a decent return for their investment in public interest journalism from digital platforms such as Google and Facebook.' Indeed, before the government announced it would legislate a mandatory code, Labor called for it to be fast-tracked. In an opinion piece in TheNew Daily on 18 April 2020, I said:

The government must recalibrate and deliver its responses to the recommendations of the ACCC's Digital Platforms Inquiry in a timely manner in a world changed by COVID-19.

This means being ready to intervene with a mandatory code to support news media companies being paid for their content on digital platforms, in the event progress on a voluntary code is inadequate.

…   …   …

The media … will not sustain the inaction of this government much longer.

With the prospect of regional areas becoming news deserts, it's well past time this government just did its job.

I would like to turn to the issue of overall delay in this matter. Labor has long recognised the profound impact that digital platforms have had on the Australian media. For years Labor has been calling on the government to overhaul the outdated policy and regulatory framework to address digitisation and convergence. It is a matter of public record that it was Labor who first called for an inquiry to examine the contemporary media landscape. In 2016 I called for a thorough examination of the state of the Australian media landscape, noting there had not been a comprehensive inquiry into ownership, concentration and competition in the Australian media market since the late 1990s. I said that the government should ask an independent body, such as the ACCC or the Productivity Commission, to assess the state of play so parliamentary decisions could be evidence based. But the then minister for communications rejected this suggestion, saying, 'All the relevant facts are known.' Over one year later, in December 2017, the government finally did direct the ACCC to conduct an inquiry into the impact of digital platforms on the state of competition in the media and advertising markets, the Digital Platforms Inquiry. So, contrary to the then minister's assertion, clearly all the facts were not known. The ACCC was given 18 months to inquire and report, and its issues paper contained around 48 questions for consultation. Ultimately, the final report of the Digital Platforms Inquiry contains 23 recommendations and highlights a number of ongoing investigations by the ACCC.

Labor is pleased Australia now has the benefit of the ACCC Digital Platforms Inquiry. We acknowledge the power imbalance identified by the ACCC between news media companies and digital platforms. We support a workable code to address this imbalance. But we are frustrated by the government's lack of urgency in acting to address the challenges facing Australian media and public interest news gathering in particular.

Over three years ago, in 2017, I was in this place debating the government's changes to media law. At the time, the government heralded its changes as 'a new era for Australia's media', claiming:

The government is strengthening Australia's media industry, enhancing media diversity and securing local journalism jobs, particularly in regional areas.

Flash forward to today, however, and the reality reports a very different story. Around 200 newspapers have closed and hundreds of journalism jobs have been lost. There are around 21 local government areas without coverage from a single local newspaper, either print or online, including 16 in regional Australia. Media diversity in regional and remote areas is already at or below the minimum number of voices in 68 per cent of licence areas.

The government recently admitted signs of market failure in regional commercial television broadcasting. Regional media organisations launched a campaign, Save Our Voices, voices forgotten by years of government inaction and neglect. In fact, the government's media law changes failed to address the true reform agenda. It left media exposed to external shocks and repealed the two-out-of-three cross-media control rule, which permitted Australia's already highly concentrated media sector to become even more concentrated. At the time, Labor warned the changes were inadequate and urged the government to undertake genuine holistic reform. When the final report of the ACCC's Digital Platforms Inquiry was delivered to government in June 2019, it devoted an entire appendix to the many reviews of media industry laws and regulations that have been conducted.

Underlining Labor's repeated calls for the need for genuine reform, the ACCC's recommendation 6 is that a new platform-neutral regulatory framework be developed and implemented to ensure effective and consistent regulatory oversight of all entities involved in content production or delivery in Australia, including media businesses, publishers, broadcasters and digital platforms. While the government ultimately accepted this recommendation in its December 2019 response to the ACCC's final report, we are yet to see such a framework materialise. The years-long delay under this government simply drags on and on.

Unfortunately the process to implement a mandatory news media bargaining code is also running late. This government said it would get the code in place last year, in 2020, but it was late introducing the bill to the parliament and didn't introduce it until the final sitting week of parliament last year. As late as mid-February 2021, as late as yesterday, Labor was still waiting for the government to reveal potential government amendments to its own legislation. Even at this late stage there has been great uncertainty as to what the government's final code will be. Labor—and many others, no doubt—has been waiting to find out. Labor welcomes news that Australian publishers are signing on to Google News Showcase, but we query whether the process needed to be dragged out in this way.

It is now over 18 months since the ACCC found that the major digital platforms are unavoidable trading partners for Australian news businesses and, therefore, possess substantial bargaining power over these businesses. And it is over 18 months since the ACCC recommended that designated digital platforms provide codes of conduct governing relationships between digital platforms and media businesses to address the imbalance in the bargaining relationship. Yet we've only just had the government confirm the final shape of this bill that's before us.

Labor supports the bill as amended. We note, however, that there remains a great deal of uncertainty about the future designation of platforms and services, which remains a matter of ministerial discretion. We note that not all Australian news media businesses have struck commercial deals with the digital platforms and that the passage of this bill may impact their relative negotiation position with those platforms. It is not clear how the government will achieve the intention of levelling the bargaining position between the news media and digital platforms if the negotiate-arbitrate provisions of this bill do not apply. For this reason, Labor recommends that the government use precise language in public statements regarding what designations it intends to make under the code. This is in order to save any misunderstanding or unnecessary uncertainty for the media, the digital platforms, small businesses and citizens and consumers who may be impacted.

It was over a year ago, in December 2019, that the government tasked the ACCC with facilitating the development of a voluntary code of conduct to address bargaining power concerns between the digital platforms and media businesses. At that time, Labor warned that the government's record of going slow meant there could be little confidence that the regulatory asymmetry, uncertainty and delay would end any time soon. In April 2020, in response to COVID-19 pressures as well as ACCC advice that a voluntary agreement on the issue of remuneration was unlikely, the government directed the ACCC to develop a mandatory code of conduct. Labor welcomed this step. In July 2020 the ACCC released a draft code for consultation, stating the code would be finalised shortly after. Labor welcomed this process. But the fact is the code was not finalised shortly after. It wasn't until December 2020 that the government introduced legislation for a mandatory code into this parliament. The Senate referred the bill to the Senate Economics Committee for inquiry and report by 12 February 2021. Labor welcomed the introduction of the bill into parliament, particularly welcoming the inclusion of the public broadcasters, the ABC and SBS, which Labor had called for, but criticised the delay and the government's failure to deliver last year for a media industry in crisis.

The Senate inquiry was an opportunity for public scrutiny of the bill. But it wasn't until after the conclusion of public hearings for the inquiry that there were further developments and negotiations between the government and Google. As late as 4 February, the government signalled that it may be contemplating key amendments to its bill. On 4 February, it was reported:

Google has not backed down on its threat to withdraw from Australia in a call between Scott Morrison and the tech giant's parent company chief Sundar Pichai on Thursday, but tensions appear to be easing.

The Prime Minister said … "I have been able to send them the best possible signals that should give them great encouragement to engage with the process and conclude the arrangements we'd like to see with the news media organisations," …

On 5 February 2021, it was reported of Google News Showcase:

… the Treasurer urged the search giant to launch the product and get deals with publishers done.

There was an understanding that the government may then consider amendments to the proposed mandatory bargaining code which the Silicon Valley-based company has requested, industry sources said.

Labor further notes that there were also developments and negotiations between Google and the news media which are ongoing. On 4 February 2021 Google announced that Google News Showcase had launched in Australia, and a number of Australian publishers, representing even more titles, have signed on to it. Labor is pleased that this list grows by the day. It demonstrates that commercial deals are capable of being executed in the absence of regulation, as has been demonstrated overseas in recent months as well as in Australia more recently.

It is widely accepted that the spectre of the proposed code has assisted in making the digital platforms more responsive to the needs of the Australian news media, and this is welcome. While it is the case that the process has resulted in commercial deals being struck, it is also the case that the delay to this process has stifled innovation and investment in Australia. I note that while the government has made quite a spectacle of not responding to so-called threats made by digital platforms, it would appear that the resolution of the issues required only a few technical amendments. There have been varying reports as to whether the government has caved or backed down or whether they are simply making some minor clarifications.

At all times, however, Labor has been outcomes focused. We know that this code is about ensuring the sustainability of public interest journalism in Australia and the importance of the fourth estate in light of the ongoing disruption to news media, which it has experienced for decades, to its traditional business models and also in response to the impact of the market power of the digital platforms. Ultimately, this is about the healthy functioning of our democracy. Given the potential impact of this legislation on news media businesses, digital platforms, small businesses, citizens and consumers, the government should've had its ducks in a row. The government should have circulated its amendments much earlier than it did to end the uncertainty and level the playing field between the news media and the digital platforms.

I want to highlight some of the stakeholder concerns with the bill. Labor supports the intention of the bill, which, as I said, is to address the dominance of digital platforms such as Google and Facebook for the benefit of the Australian news media. Labor notes, however, that the corollary of addressing the dominance of digital platforms may involve potential impacts beyond the news media, the outcomes of which are unknown. The government's indication by media release on 8 December 2020 that the code will initially apply to Google Search, combined with the minister's subsequent enthusiastic promotion of alternative search engines Microsoft's Bing and DuckDuckGo, has caused many Australians and small businesses to experience uncertainty and worry as well as to express concerns about the impact of the potential withdrawal of the Google search engine from Australia.

In addition to the submissions to the inquiry, this has been brought to the attention of Labor MPs and senators by many individual constituents and small businesses directly. A broad range of stakeholders, including peak business groups, acknowledge the potential disruption for millions of consumers and small businesses during the economic recovery in the event Google were to withdraw search and Facebook withdraw news from Australia in response to the passage of the bill. This is despite the availability of alternative search engines and social media platforms.

It is very concerning that a number of questions about designation under the code asked by the Senate scrutiny of bills committee have not been answered by the Treasurer and some remain outstanding. It is also concerning that Treasury and departmental officials were unable to provide satisfactory answers to key questions on the impact and risk assessment and cost-benefit analysis on the bill at the public hearing. For this reason, Labor submitted further questions on notice in writing and we remain concerned that no further analysis or information appears to have been forthcoming in the response. It would appear that the Prime Minister, the Treasurer and the minister caused a great deal of uncertainty and anxiety for small business when all that was needed were some 'clarifications and technical amendments'.

Some of these concerns were held by smaller media players. Evidence to the inquiry indicates that, in the event that Google and Facebook withdraw services from Australia, the fact is revenue will not flow from these digital platforms to the news media in that scenario. Some mainstream media businesses may benefit from increased direct traffic to and/or advertising on their own news products and services, but small and independent media businesses risk losing search and social traffic referrals and, as a consequence, undermining media diversity.

Labor's of the view that a strong, high-quality and diverse news media sector is essential to a healthy democracy. Equally, we are of the view that a strong, high-quality and diverse tech sector is necessary for a healthy network society and digital economy. We are mindful of the fact that Australia has one of the most concentrated media markets in the world and that search engines and social media are instrumental in facilitating access for many Australians to a more diverse range of news media, both domestic and international. Australians deserve the best in terms of choice and quality, and we are concerned that any reduction in that choice or quality would be to the detriment of Australian citizens and consumers. We also recognise that Australian small businesses and consumers deserve choice and the best quality when it comes to digital services and products. They also deserve choice and quality when it comes to public interest journalism.

Labor notes there is broad in-principle support for a code and the regulation of digital platforms; however, as I have mentioned, many stakeholders have concerns with the bill as drafted. There is a divergence of views, including between established mainstream media and, as I mentioned, new and emerging media, in accordance with their respective reliance on search and social media for audiences and revenue. A range of stakeholders sought amendments to the bill, including peak media industry bodies. We note concerns around unintended consequences—such as those relating to the professional standards test, as well as the potential to incentivise clickbait—and regard these as matters of consideration up to, including and after the 12-month review of the code. The Bills Digest summarises these concerns, and I won't restate them all here. Suffice to say there will be plenty of issues to canvass in the 12-month review of the code.

On ABC Radio National this week, the Treasurer said that the deals being struck, even before the passage of the legislation, 'will transform the domestic media landscape' and are 'something that can ensure a sustainable media landscape'. There is no doubt that an additional revenue stream is a welcome thing, and we hope the deals under this code are transformative. What we want to avoid is the government dusting off its hands and saying, 'job done', as it did in 2017 when it proclaimed its changes to media law heralded a so-called new era for Australia's media.

We hope this measure makes a significant contribution to the news media. Labor is pleased at evidence that work on the code to date has improved the responsiveness of digital platforms to the news media, but we note it does not of itself ensure a sustainable media landscape. We are mindful of evidence that the code does not guarantee any particular outcomes for the media, journalists, citizens or consumers. At public hearings to the inquiry, media stakeholders were not yet clear on how much additional revenue derived as a result of an improved bargaining position under the code will actually be invested in additional journalists or journalism. This underscores the fact that the code is not a silver bullet and that this government must do more to support public interest journalism in Australia. In the time since the ACCC released the final report of the Digital Platforms Inquiry in July 2019, the government has failed to address a number of these recommendations, including genuine media reform, stable and adequate funding for public broadcasters, adequate direct funding, tax incentives and philanthropy measures. After such a significant investment of time and resources by government and industry, this government has proved incapable of implementing reform to address issues that, years ago, they said warranted reform.

Next month marks one year since COVID-19 related closures and suspensions of news titles began to be announced, compounding the closures that had already occurred over the decade prior as a result of many factors, including digital disruption. This code is only one of a suite of measures recommended by the ACCC to support public interest journalism. The evidence before the Senate inquiry into the bill was clear: this government has a lot more to do to support public interest journalism in Australia. This includes support to ensure the ongoing viability of the Australian Associated Press as the key wholesale provider of news in Australia and a critical pillar of media diversity. The code does nothing to help AAP Newswire, and any notion of trickle-down economics under the code is naive. Labor drew the plight of AAP to the government's attention in March 2020, including through Senate estimates, and called on the government to provide COVID-19 relief to the media in April 2020. The government's April 2020 announcement of the $50 million Public Interest News Gathering Fund was inadequate. It was a re-announced fund, mainly comprised of funds they had previously failed to get out the door, and an admission of failure. The government's September 2020 announcement of $5 million for AAP was late and inadequate. The benefits to democracy of an independent wholesale Newswire business are many, and we urge the government to make appropriate provision for AAP as a matter of priority.

Last year Labor also led calls decrying the exclusion of the public broadcasters, the ABC and SBS, as a missed opportunity, particularly for news in regional areas. Labor said that excluding the ABC and SBS was a missed opportunity to derive value for money from taxpayer investment in news media production. It was also a missed opportunity to address another finding of the ACCC in the Digital Platforms Inquiry:

… the public broadcasters are not currently resourced to fully compensate for the decline in local reporting previously produced by traditional commercial publishers.

It was counterintuitive to exclude the ABC and SBS from a framework designed to support public interest journalism, just as this government's deep ABC cuts ran counter to the ACCC's recommendation that the ABC have stable and adequate funding. We're pleased that this government has come to its senses on this point and at least not excluded the public broadcasters in this bill.

Meanwhile, it remains to be seen what impact this code will have to support small and independent publishers in outer metro and regional areas. Country Press Australia is a strong voice for its members and holds valid concerns that the deals now being struck under Google's News Showcase, for example, will benefit mainstream media players while smaller regional outlets are set to wait for the crumbs yet again. It is imperative that the government ensure direct taxpayer funded grants for public interest journalism be well targeted and supplied to public interest journalism outlets. They are the lifeblood of regional communities, yet they do not derive significant benefit under the code, whether via a standard offer or collective negotiation or arbitration.

In conclusion, Labor supports this bill amended by the government. We join with other stakeholders in commending the work of the ACCC and Rod Sims in progressing this work. We thank the ACCC's global counterparts for their input and collaboration. Labor acknowledges the many industry stakeholders that have participated in multiple meetings and consultations and made many submissions at considerable time and cost, and the public servants who have been working to settle the code. I acknowledge the Senate's scrutiny of this package in the public interest. Labor supports this bill and emphasises that support for public interest journalism is not a set-and-forget task. It is imperative that this government act on the balance of the recommendations of the final report of the Digital Platforms Inquiry as a matter of urgency. To that end, I move the second reading amendment circulated in my name:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House notes:

(1) Australia has one of the most concentrated media markets in the world;

(2) since the Government's changes to media law in 2017 there have been alarming contractions and warning signs of market failure in Australia's media landscape;

(3) the bill was introduced 18 months after the ACCC delivered the Final Report of the Digital Platforms Inquiry in June 2019 and does not address all of the ACCC's recommendations to support public interest journalism;

(4) the Government must do more to support public interest journalism in Australia as a matter of urgency; and

(5) the Government should make appropriate provision to ensure the viability of AAP newswire as a matter of priority."

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