ALI MOORE:
Stephen Jones is the Assistant Treasurer, also the Minister for Financial Services. And Stephen Jones, I think I might just have to say welcome back to your regular spot on Drive.
STEPHEN JONES:
Good to be with you again, Ali.
MOORE:
That’s good. We have spoken with you a little lately. So, this is designed essentially to get the media platforms to pay for the news without giving them an opening to simply pull news off their platforms.
JONES:
Yeah. Look, a couple of background points to help your listeners. There was a News Media Bargaining Code legislated by the former government, we supported it. We’ve had a look at it. We believe that it needs strengthening to ensure that there is a strong incentive for media platforms to negotiate in good faith with local media outlets.
Why are we asking them to do this? Two reasons. One, there’s a public interest in ensuring we have a strong independent journalism and news media industry in this country. It’s what keeps democracy strong, it’s what creates a free society, so it’s a public good. If you look at what happened to news businesses over the last 2 decades, the introduction of digital platforms has been a significant disruptor. They’ve taken content from the news publishers and not paid for it. But perhaps more critical than that, they’re now the major source of revenue from advertising, which is what has funded journalism in this country. So, for those 3 reasons, we think they need to make a fair contribution.
They won’t be the major funder of news media and journalism in this country, but they should make a contribution. We want that to be through voluntary commercial agreements, and this news media incentive is a charge which operates in similar ways. Your listeners will be familiar with the Medicare surcharge levy, which is an incentive for individuals to take out private health insurance. The objective of the government is not to collect one cent, it’s to incentivise business deals between media outlets and the platforms.
MOORE:
But if you hadn’t done this, if you just said, sit down and you know, you’ve got to sign these agreements, then they’re likely to have just said, well, actually we’re not going to have any news on our sites. And they just basically pull out of news, wouldn’t they? This is your way of – regardless of whether they have an interest in putting news on their sites, they have no choice but to pay the tax or basically fund the organisations.
JONES:
Yeah. A couple of things, I want to single – Google has done the right thing and they’ve continued to negotiate and I congratulate them for that. But not every other platform has behaved in the same way. So, we want to provide an incentive and recognise the businesses that are doing the right thing and are negotiating and are reaching commercial agreements. So, we want the revenue. But frankly, as you said in your intro, a significant number of Australians go to a social media platform as the portal into news services. That’s their entry point into news services. We think social media platforms have lots of content on it, but amongst all of that content should be decent, fact‑tested professional journalism.
MOORE:
How are you going to enforce it?
JONES:
It’ll be enforced like other taxation laws, whether it’s corporate tax or individual tax, it’ll be enforced in the same way. So, it’ll be administered by the Australian Tax Office, and they’ll have all the enforcement powers that they have, which are considerable, to ensure the law is complied with. I want to stress again, we actually don’t want to collect a cent; we want to get to the end of an accounting period, and the offsets equal the liability, and no revenue is collected by the Commonwealth. It’s all been offset by commercial deals.
MOORE:
At the same time, though. I mean, does anywhere else in the world tax a company unless they do something that is not core to what they would see as their business model?
JONES:
Well, we actually think it is and should be a part of the information that is available to people who are visiting those platforms for the reasons I’ve just stated –
MOORE:
But arguably, you could argue the news organisations have failed to pivot. The platforms are the one that were the ones that are the disruptors. But if the news, you know, if the news organisations have also benefited by being on the platforms.
JONES:
Yep. There’s no doubt that there is mutual benefit and that’s what commercial agreements will recognise. And that’s why it’s far better to have the party sitting down around a negotiating table, knocking out a deal that’s in their mutual interests, rather than having the governments dictate the terms of those agreements. So, that’s again why I say we want an incentive. You’ve asked me whether there is anywhere else in the world. Well, there wasn’t anywhere else in the world that had a News Media Bargaining Code in 2021 either, and we think it served a good public purpose. We’re strengthening that code through this measure, and whatever other jurisdictions do, we think this is in our national interest. And for the reasons I’ve stated, we think journalism is critical to a free society.
MOORE:
You say that it will be enforced through the tax system. I suppose there’s nothing to stop the social media companies just up sticks and out if they don’t want to pay it.
JONES:
Well, let it be a significant commercial decision for any of them to make. We’re a pretty profitable country for them to do their business. I can just think of one: Meta. They’d make somewhere between 5 and 6 billion dollars a year in revenue out of Australia. That’s not chump change. So, it’d be equivalent of cutting your nose off to spite your face. And we don’t want to get into that territory. We actually want to say, can we all act like grown‑ups here? Can we strike a commercial deal that’s in everyone’s interest and get on and run our news outlets, do journalism, run your digital platforms and include news content on there.
MOORE:
And so I did say before Facebook, Google, TikTok, not X, is that right, because they don’t make enough money?
JONES:
Yeah. So, we’ve set a threshold and there is some science in the threshold. The original basis of the bargaining code was to level out the bargaining playing field between these mega‑platforms, the multinational very, very powerful platforms that have overwhelming bargaining power. They’re a business partner, a necessary business partner for most businesses in Australia these days. So, individual businesses don’t have the same bargaining power or even substantial news outlets in Australia don’t have the bargaining power. So, to level the playing field, and this incentive will help to level the playing field. So, there is an incentive there for businesses to negotiate.
MOORE:
We did request an interview with Meta. They’ve just given us a statement, but essentially they’re saying that the proposal fails to account for the realities of how our platforms work. Specifically that most people don’t come to our platforms for news content and news publishers voluntarily choose to post content on our platforms. I suppose that’s just to lead into a broader question. How do you expect the big tech giants to respond?
JONES:
Well, I hope they see that this is a part of their social license, and I hope they respect the decision the Australian Government has made, on behalf of the Australian people, for the good of our democracy and news journalism in this country. Other countries will put in place arrangements which they best think meets their local needs. But the Albanese government strongly believes that we need to have a strong, robust journalism sector. Digital platforms have a role. Not the only business that has a role, but they have a role in sustaining that and an important one that doesn’t replace other sources of revenue, whether it’s advertising or subscription revenue that media outlets have, or in the case of the ABC, government funding. It doesn’t replace all of that, but it supplements those funding sources.
MOORE:
Stephen Jones, good to talk to you again. Many thanks.
JONES:
Thanks Ali.