#Microsoft says Google and Facebook should pay publishers for news

Microsoft is urging the US to adopt a version of a proposed Australian law that would force Google and Facebook to pay news publishers for their stories, arguing that it would “strengthen democracy” and “support a free press.”

The legislation calls for Google and Facebook to pay a yet-to-be-determined fee for including links to news articles on their platforms. Critics say it’s unfair that the tech giants have been including them for free, boosting their own advertising revenues in the process.

The bill, currently before an Aussie parliamentary committee, is being closely watched by media execs worldwide as a possible model for other countries as media outfits have been hit particularly hard by the pandemic over the past year.

The bill in Australia is being closely watched by media execs worldwide, who see it as a possible model for other countries as media outfits have been hit particularly hard by the pandemic over the past year.

The Trump administration had objected to the Australian proposal, saying it penalized two large US companies. But in a Thursday blog post, Microsoft president and chief legal officer Brad Smith said the Biden administration should not fight Australia’s proposed law, but “copy it.”

“What is wrong with compensating independent news organizations for the benefits the tech gatekeepers derive from this content?” Smith wrote.  “Australia’s proposal will reduce the bargaining imbalance that currently favors tech gatekeepers and will help increase opportunities for independent journalism. But this a defining issue of our time, going to the heart of our democratic freedoms.”

Data-tracking firm eMarketer said that Google and Facebook this year will command more than 50 percent of all digital ad dollars spent in the United States, pulling in over $90 billion between them. Google is expected to pull in $50.2 billion or about 29.3 percent of the total US digital ad market, while Facebook will make up $40.76 billion or 23.8 percent of the market in 2021.

Google has been lobbying furiously against the Australian legislation. If it passes, the Silicon Valley giant has threatened to shut down its search engine in Australia altogether. Facebook has said it will stay in Australia, but might restrict users’ ability to select articles on its sites.

Microsoft has skin in the game, noting that its own search engine known as Bing, which currently has only 5 percent of the search business, would be happy to step into the breach.

In France, Reuters reported Friday that after years of legal wrangling, Google has agreed to a three-year deal that will pay $76 million to a group of publishers which includes the country’s biggest newspaper, Le Monde. But publishers who were left out of the deal blasted it as unfair and said Google deliberately split the publishing industry to avoid a bigger payout.

In the UK, Google this week said it has reached an agreement with 120 publishers including Reuters and the Financial Times to pay for the content under its new Google News Showcase as part of a program to spend $1 billion on publishers worldwide over the next three years. News Corp., the parent of The Post and publisher of the Times of London, is not participating.

David Chavern, president of the News Media Alliance, a publishers group that includes News Corp., applauded the developments in Australia and said he hopes to see it expanded in the US.

“This is a tremendously important step toward preserving high-quality journalism, not only in Australia but around the world.”

He called the Australian bargaining code “a model of historic importance – akin to the creation of the music licensing system – that is already changing the debate about the future of news publishing.”

In the US, the Journalism Competition & Preservation Act, which has been introduced in the House and Senate, would grant news publishers the ability to overcome antitrust hurdles and negotiate collectively with the tech platforms for compensation for use of their content. The New Media Alliance is pushing for passage.