JOSH FRYDENBERG:
Facebook has re-friended Australia and Australian news will be restored to the Facebook platform and Facebook has committed to entering into good faith negotiations with Australian news media businesses in seeking to reach agreements to pay for content. This follows a series of intensive negotiations with Facebook since their actions last Thursday. It’s involved the Minister, the Prime Minister, and the head of the ACCC, Treasury, and myself. We have agreed to make some clarifications to the code. When it comes to the designation process by the Treasurer of a particular digital platform, a one month period notice period will be put in place. The Treasurer will also take into account not just the unequal bargaining position between the digital platform and the Australian news media businesses, but also the commercial deals that have been put in place and that digital platform's commitment to supporting public interest journalism in this country. Also, ahead of the formal arbitration process will be a period of up to two months for a mediation. There already is an up to three month period for a negotiation, and if that is not successful, then it moves to an up to two month period for mediation ahead of final offer arbitration. Absolutely critically, the Code maintains its key measures. Namely, it’s a mandatory code. A world leading code. Secondly, it is based on two way value exchange. And third, it involves a final offer arbitration mechanism. I want to thank Mark Zuckerberg for the constructive nature of the discussions we have had over the course of recent days. It has been a difficult process, but these are really important issues. These are important issues because the purpose of the code and the purpose of the Morrison Government's intentions have all along been designed to sustain public interest journalism in this country. That is why we have sought to put this code in place. That is why the now Prime Minister, then the Treasurer, commissioned the ACCC to undertake this ground-breaking review a number of years ago. Thank you, Paul, for your involvement in this process, it has been great working with you, I’ll hand it to you.
PAUL FLETCHER:
Thank you Treasurer. I will just add a couple of points to what the Treasurer has said. The first thing is that the whole purpose of the mandatory code process has been to give a strong incentive to the digital platforms to do commercial deals with Australian news media businesses. It is an example of the negotiate, arbitrate model which is used within a range of ways within Australian competition law and policy, and these technical changes will further give a strong incentive for those commercial deals, building on what we have already seen announced as between Google and parties like Seven West, Nine Entertainment Ltd, New Corp, and The Guardian. The second point I’d simply highlight is the requirement in the legislation for the Treasurer to consider the extent to which commercial deals have been done, before he makes a decision to designate, will be important in terms of smaller and regional publishers. There’s a mechanism there for a default offer for smaller and regional publishers, and of course, the Treasurer will be able to have consideration to whether there are deals in place not just for the large publishers but also for those small and regional publishers. Treasurer.
JOSH FRYDENBERG:
Are there any questions?
JOURNALIST:
Facebook has said that it retains the ability to decide if news appears on Facebook. So are we basically back to stage one where Facebook is now saying we’re going to negotiate with media companies but we won’t necessarily do a deal and we won’t necessarily put their content on our website?
JOSH FRYDENBERG:
Well let's just see what happens in coming days in respect to commercial deals. That’s certainly the intention from Mark Zuckerberg, as he explained to me, was to do commercial deals, and they are pretty advanced with a number of parties. They were ahead of their actions last Thursday and obviously that was interrupted, and now they have re-engaged with the parties. What we saw with Google, and that was a pretty protracted and difficult negotiation as well. But what we saw with Google was significant deals, millions of dollars flowing to support public interest journalism in this country, with a range of players, and we have also praised Google for their constructive discussions that we have had through this whole process. We spoke to Google ahead of today’s announcement about some further changes and Google's response was that these were sensible changes. So those deals remain in place between Google and their commercial partners. More deals, no doubt, will be struck. They include deals with not just the big players as Paul mentioned; Nine, Seven, News Limited and The Guardian, but also some of the smaller players as well, so Facebook is now going to engage in good faith negotiations with the commercial players and our message from Paul and I, to Australian news media businesses is no doubt to sit at the table and hopefully conclude the deals.
JOURNALIST:
So under this model then, could it be that Facebook will do deals with some media organisations and show their content on its website and those that it can’t do deals with, it just won’t show?
JOSH FRYDENBERG:
Well there’s a non-discrimination clause and that still remains in place, and you can't do deals with one party and not do deals with other parties and not be subject to the code. What we have made clear though, is that the nature of those deals between the digital platform and the individual media business can be different. They may involve different products, they obviously may involve different sums of money, they may be for a different length of time. What we have seen to date with Google are longer term deals and we hopefully will see similar longer term deals between Facebook and Australian media businesses.
JOURNALIST:
When do you anticipate that we are going to start seeing news back in our newsfeeds?
JOSH FRYDENBERG:
Well Mark Zuckerberg said to me today that that will occur in coming days. Obviously that is a question for the engineers at Facebook, but certainly a commitment both in their statement as well as in the words to me directly from Mark Zuckerberg were that news content will be restored to Facebook's Australian platform.
JOURNALIST:
They can just flick a switch can’t they, like they did on Thursday?
JOSH FRYDENBERG:
Well, you may know more about the engineering details of such a program. I know that they've told me that it will happen in coming days.
JOURNALIST:
What exactly did you have to give Facebook to [inaudible] change his mind? Was it just these amendments or was there something else? What really convinced them [inaudible] pretty strong for a number of days. And do you still consider Facebook's behaviour deplorable and bullying? Or are you and Mark Zuckerberg on fantastic terms (inaudible) and already re-friended each other?
JOSH FRYDENBERG:
Well, the fact of the matter is, their behaviour last week was regrettable and I expressed that very directly to Mark himself. I said, not only was the Australian Government disappointed in what Facebook did, but we were disappointed in the way they did it, because we weren't given any advance notice. So, clearly, the Government’s made its feelings felt. No doubt Australians have made their feelings felt. But at the same time, our commitment to the Code remained, and that is what we are now proceeding to pass through the Parliament, is the legislation to put in place a world leading Code, a Code that has been the product of years of work.
JOURNALIST:
These changes today just pave the way, don't they, for this world leading code to be in place that ultimately neither platform is designated to comply with?
JOSH FRYDENBERG:
There is no doubt that Australia has been a proxy battle for the world. I have no doubt that so many other countries are looking at what is happening here in Australia, because of this innovative code that the Australian government, the Morrison government is now pursuing. So Facebook and Google have not hidden the fact that they know that the eyes of the world are on Australia, and that is why they have sought to get a code here that is workable. Now clearly, they would have loved to continue to provide their technological services into the Australian market without the code being in place, but as Paul and I know, we want Australian journalists who generate original content, should be remunerated for that, and that has been the purpose of the code and the commercial deals being struck between the parties has been a priority and the code is being designed to encourage those deals but obviously with a last resort, final offer arbitration model in the event that those deals are not reached.
JOURNALIST:
Can I ask the Communications Minister for your first impressions of the digital disinformation and misinformation code released yesterday? Why did the government go for a mandatory approach when it came to securing revenue from the digital giants but an opt-in approach when it came to misinformation? Is securing commercial revenue for news organisations more important than combatting misinformation?
PAUL FLETCHER:
The code that is being released to deal with misinformation and disinformation, reflects a recommendation to the government of the ACCC digital platforms inquiry. In fact we have worked across a number of those recommendations, that very substantial report commissioned by the Prime Minister when he was Treasurer, several hundred pages, extremely detailed work done by our competition regulator. They had recommendations in a range of areas and we have been pursuing a number of those, one of those and we worked on this throughout last year was in relation to this code to deal with misinformation. Consistent with the recommendation of the ACCC it is a voluntary code. We have made it plain that we will review the performance, in fact the Australian Communications and Media Authority will report to me by the middle of the year on performance. We’ve also made it plain that if we don't see that code working we will certainly consider other measures.
JOURNALIST:
If Facebook is to avoid coming under the code, will it have to do deals with all the major media organisations? Like how broad is this non-discrimination clause?
JOSH FRYDENBERG:
Well we’ve made it very clear that they need to do commercial deals with Australian media businesses. Now the decision on designation is one for the Treasurer, it will be one based on advice, it will be a two-tiered test effectively, the unequal bargaining position of the respective parties, bearing in mind that was the reason why we said early on, that this code was to apply to Facebook and Google, and we didn't go into details about some of the other digital platforms that are available. The other tier to the test is the commercial details that are being put in place, and we have obviously spoken in the past before about a default offer being available to some of the smaller players, and we would encourage the digital platforms, both Google and Facebook, to enter into these good-faith negotiations as we have seen to date from Google and to conclude those agreements and I know having spoken to Facebook multiple times today, that is their intention.
JOURNALIST:
Will the government reallocate funding back into Facebook for the vaccination information campaign? You said earlier this week that funding was going to be reallocated out of it because of what Facebook has done. Is the money going directly back to [inaudible]?
JOSH FRYDENBERG:
The government is looking to bring back its advertising onto Facebook, and obviously that is a welcome development, but so is today's news where Facebook has re-friended Australia, thank you.