Digital platforms such as Google and Facebook could be required to 'fairly negotiate' with media organisations and apportion revenue they receive from their original content.
The ACCC found that digital platforms are subject to virtually no media regulation, and have recommended the introduction of a platform-neutral regulatory framework to address this imbalance.
The ACCC has proposed that digital platforms also develop an industry code of conduct that addresses the dissemination of harmful disinformation.
The ACCC's Digital Platforms Inquiry Final Report (Report) has delved into the disruption that digital platforms – largely, Facebook and Google – have prompted within the media industry. It seeks to shine a light on the costs and consequences, as well as ways we can embolden traditional media and journalism to survive in the digital era.
The Terms of Reference for the Inquiry specifically requested the ACCC consider the impact of digital platforms on the level of choice and quality of news and journalistic content to consumers, and the broader impact on media and advertising markets. As a consequence, the Report provides insights into the operation of the modern media industry. Some of these findings include:
Many of the ACCC's recommendations focus on bolstering the commercial media industry in the face of these challenges and creating a more effective and consistent competition and regulatory landscape.
One of the more significant recommendations that could lead to practical ramifications for the bottom line of media companies is that designated digital platforms provide codes of conduct governing their relationships with media businesses to the Australian Communications and Media Authority (the ACMA).
This stems from particular concerns the ACCC states were raised during the Inquiry, regarding the ability of digital platforms to alter key algorithms with no notice, and introduce policies or modifications that have the potential to significantly impact the dissemination of news and journalism (and the consequential monetisation).
The ACCC states that each platform’s code of conduct should ensure that they treat news media businesses fairly, reasonably and transparently in their dealings with them, and contain at least the following commitments:
The final point is significant and even radical, as it introduces the prospect of revenue-sharing or compensation going from digital platforms to news media organisations – a proposal with potential to realign the trajectory of the media industry.
The ACCC has tasked the ACMA with the role of designating which digital platforms should be required to implement a code, creating guidelines regarding how platforms should develop a code and what should be included, approving proposed codes and dealing with breaches.
The Report recommends a strong enforcement mechanism be introduced, vesting the ACMA with power to impose sufficiently large sanctions that will act as an incentive for digital platforms to comply, and lead to real change.
“The Report makes one point clear: virtually no media regulation currently applies to digital platforms.”
As a consequence, the ACCC proposes a process to implement a platform-neutral regulatory framework that would have oversight of all entities involved in content production or delivery in Australia, including media businesses, publishers, broadcasters and digital platforms.
Again, the underlying purpose of this recommendation is to create a level playing field in our markets where current regulatory codes have failed to keep pace with technological changes that have revolutionised our consumption of news and media content more broadly.
The Report recognises that moving from disparate regulatory systems for publishers and broadcasters to a platform-neutral framework that sees obsolete regulations repealed is a significant reform. In light of this, a staged approach is recommended, but one that sees disparities of immediate concern addressed as a priority. These include the differences in election advertising restrictions and local content obligations that particularly, TV and radio broadcasters must adhere to.
The Report also recommends adjusting the tax settings to encourage philanthropic support for journalism. This would be through establishing new categories of charitable purpose and deductible gift recipient (DGR) status for not-for-profit organisations that create, promote or assist the production of public interest journalism.
Other proposals to improve the standard of media content include a grants program that supports the production of original local and regional journalism, as well as stable and adequate funding for the public broadcasters, the ABC and SBS.
A critical issue facing digital platforms in recent years has been the active dissemination of disinformation, colloquially dubbed 'fake news'. This has generated global discussion, as governments have had to consider the impacts on the free-flow of communication any regulation could have.
The ACCC has addressed this through a recommendation that would see digital platforms implement an industry code of conduct to govern the handling of complaints about disinformation (which is defined as 'inaccurate information created and spread with the intent to cause harm') in relation to news and journalism.
In order to avoid the abuse of such a regulatory system, the application of the code would be restricted to complaints about disinformation that meet a ‘serious public detriment’ threshold. The code would outline suitable responses to complaints of disinformation.
This recommendation is coupled with proposals that digital media literacy in both schools and the community more broadly is improved, and that the ACMA be directed to monitor the initiatives of digital platforms to implement credibility signalling to their users – allowing more trustworthy news sources to be recognised and relied upon.
The federal government is now conducting a 12-week consultation, inviting submissions in response to the Report. The ACCC's recommendations clearly have the potential to impact the nature of the relationships between digital platforms and media organisations, as well as how each are regulated.
If you would like assistance with a submission or to discuss the potential implications of the Report, please contact our team.