Thank you very much.
Thank you for the invitation to speak today, and greetings from Sydney.
My key message is that, based on the Australian experience with its news media bargaining code, Bill C‑18 should be strongly supported. I'm going to devote my introductory comments to explaining some aspects of the Australian code and addressing a couple of criticisms of the Australian code.
The code's objective was to address the massive imbalance in bargaining power between Australia's news media businesses and the platforms. Google and Facebook do need to have news on their platform to maximize user attention and so enhance their advertising revenue on which they depend, but they do not need the content of any particular news business. On the other hand, each media business needs to be on the platform.
This bargaining imbalance—or market failure—means commercial deals cannot be done. They simply cannot be done to achieve fair payment for the benefit the platforms gain from news media content on their platforms. The outcome is less journalism.
Now, journalism benefits society in many ways, even for those who don't access it. It holds the powerful to account, provides a journal of record and is a forum for ideas. While not all market failures need to be addressed, this one needed to be, and was, with the Australian code.
Prior to the Australian code being passed, the news media businesses were simply unable to negotiate with the platforms for any payment for their content. With it, they could require the platforms to negotiate and trigger arbitration if those negotiations did not yield an appropriate result. The threat of arbitration evens up the bargaining power, as all parties wish to avoid having an arbitrator determine commercial arrangements.
Australia's code has been extremely successful in achieving its objective. From not being able to engage with the platforms because they wouldn't allow them to, the Australian news media businesses that have done deals under the code are comfortable with them, and these deals are yielding well over $200 million Australian per annum to the news businesses.
Further, Google has now done deals with essentially all eligible media businesses, while Facebook has likely done deals with media businesses employing around 85% of Australian journalists.
There are three essential features of the Australian code, all of which seem to be in Bill C-18. First, if negotiations are unsuccessful, there is recourse to final offer arbitration; second, non-discrimination, which means that if deals are done with one media business, then deals must be done with all; and third, the ability to collectively bargain.
You may be aware that Google threatened to take Google Search out of Australia, and Facebook threatened to take down all news from its News Feed if the code's legislation proceeded. The legislation was passed, but both threats were not carried out.
One outcome, however, was that the government said that if the platforms wished to avoid designation under the code, they should go out and do deals. This they did, and quickly; that is, therefore, instead of the threat of arbitration driving commercial deals, it was the threat of designation that became important. The difference does not matter. The code's objective of driving commercial deals was achieved.
Let me just address two criticisms of the code.
The first, as has been said just now, is that it was only the large media players that got deals and the smaller players missed out. This is just simply false. The facts are very clear. Australia has four roughly equal, large news media businesses. They all got deals. It has a number of medium-sized businesses that all got a deal from Google, but two of them, strangely, did not get a deal with Facebook while the rest did, so most of them got a deal with Facebook, but not all. We have many smaller media businesses, especially small regional and rural newspapers and digital natives. Essentially all of them got a deal from Google, and most of them got a deal from Facebook.
The amounts paid per journalist were usually much larger for the smaller businesses. Indeed, Country Press Australia, which represents 180 rural publications, received possibly the highest payment per journalist employed.