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Australian and EU Policy Responses to Algorithmic News Distribution: A Comparative Analysis
Abstract
This chapter compares and contrasts the Australian and EU policy responses to the problem of supporting sustainable news content in an algorithm-driven platform economy. I begin by analysing the problem of the under-production of news content and argue that this issue is best understood as arising from the market power of platforms in advertising markets. I then outline the development and structure of the Australian News Media Bargaining Code and the EU law. I go on to argue that the Australian Code is a better model as it directly addresses the under-production of news can and form part of a broader project of adjusting the principles and tools of competition policy to satisfactorily address platform business models.
... For a relatively recent piece of legislation, having been introduced in March 2021, the Code has already been the subject of considerable academic and industry commentary and critique (Bossio et al., 2022;Caffarra and Crawford, 2020;Flew and Wilding, 2021;Lee and Molitorisz, 2021;Lindsay, 2022;Leonard, 2021). Our brief overview of the legislative scheme will be followed by a closer examination of the type of regulation used. ...
Taken at face value the introduction in 2021 of Australia’s News Media and Digital Platforms Mandatory Bargaining Code (“the Code”) may appear “world leading,” innovative, and, in general, a productive and strategic intervention to reverse the decline of public interest journalism. It is claimed that in the Australian news industry context, an annual transfer of around $200 million between two platform companies – Google and Meta – and news businesses has now been put in place (Sims, 2022). All major news media companies in Australia, if not smaller more independent ones, have greatly benefitted from the new Code, and anecdotally it appears that the funding has resulted in the creation of significant numbers of new journalists being hired. Yet the exact investment destination and ultimate beneficiaries of the funding are not known beyond the corporate walls of the recipients. The article points to the transparency and sustainability problems inherent to the new Code, arguing that an alternative approach to funding public interest journalism might be a levy funded by the platforms.
Press publishers have been in dire straits following the emergence of digital news aggregators. While press publishers heavily rely on digital platforms for wider reach and audience engagement, digital platforms can easily operate without exclusive content from any specific newspaper. Digital news aggregators not only outcompete them in terms of advertising revenue but also exploit them by using their news content without fair remuneration. If an increasing number of press publishers continues to leave the market due to financial difficulties, then this will have negative repercussions for media plurality. To avoid this, several jurisdictions around the world have adopted various policy and enforcement measures. Apart from trying to increase the competitiveness of press publishers, the main approach aims at ensuring press publishers are fairly remunerated by digital platforms. The adopted measures in that respect are manifold, stemming from copyright policy, competition policy and regulation. This paper seeks to establish which measure is most adequate in safeguarding fair remuneration of press publishers.
In March 2021, Australia enacted the News Media Bargaining Code (NMBC) legislation, which compels Google and Meta to pay for third-party news content on their platforms. To date, Australian newsrooms have made deals with both platforms totalling approximately AUD126.4 million). The 1-year review of the Code has prompted questions about not just the legislation but also the lack of public detail about the deals made between news organisations and the platforms. This article seeks to critically analyse the strategic positions both Google and Facebook took in supporting public interest journalism before and after the introduction of the Code. Using a mixed methodological approach, we find that both platforms differed in their strategic engagement with Australian media organisations before and after the introduction of the NMBC and that the Code, as it stands, risks increasing platform influence in the Australian news market.
Governments across the world are struggling to address the market dominance of technology companies through increased regulation. The Australian Federal government found itself leading the world in platform regulation when, in 2021, it enacted the Australian News Media and Digital Platforms Mandatory Bargaining Code. The furore surrounding the introduction of the legislation, and Facebook's subsequent Australian ‘news ban’ exposed the limits of a regulatory model that has previously left the tech industry to moderate itself. In this paper, we argue the introduction of the Code is a leading example of a global trajectory towards regulatory change, which sees governments move from a reactive regulation model to specific interventions around the governance of digital media spaces. We discuss how best to measure the successes and failures around this more interventionist model through a case study of the implementation of the Code in Australia. More broadly we consider how global platforms have responded, and whether the reform is an effective regulatory model for other national governments to emulate.
This article provides an overview of the Australian Competition and Consumer Commission (ACCC) Digital Platforms Inquiry, as a case study in the new thinking about digital platform regulation taking place in many nations. With its focus upon the impact of digital platforms on news and journalism, the ACCC Inquiry parallels other reviews, such as the Cairncross Review on the Future of Journalism in the United Kingdom. While the Inquiry had a somewhat ‘accidental’ history, the core issues that it raised have acquired considerable political resonance in Australia. The concept of harms provides a useful lens through which to understand the ACCC’s focus, as it identified harms caused by the market dominance of Google and Facebook for traditional news media businesses, and for consumers and citizens. Responding to the ACCC Final Report will present challenges in identifying the public good dimension of journalism and who should pay for it, the scope and reach of digital platform regulation and its relationship to media policy and regulation, and the scope for small nations to effectively manage the power of global digital platform giants.
We propose an analysis of platform competition based on the academic literature with a view towards competition policy. First, we discuss to which extent competition can emerge in digital markets and show which forms it can take. In particular, we underline the role of dynamics, but also of platform differentiation, consumers multi-homing and beliefs to allow competition in platform markets. Second, we analyze competition policy issues and discuss how rules designed for standard markets can perform in two-sided markets. We show that multi-sided externalities create new opportunities for anti-competitive conducts, often related to pricing and contractual imperfections.
On 12 September 2018, the European Parliament approved the new version of the proposal for a Directive on Copyright in the Digital Single Market elaborated by the European Commission in 2016. In order to address problems in protecting content and improve the bargaining position of press publishers against information society service providers, the European Commission decided to intervene on rights, introducing an additional layer of copyright, namely a new neighbouring right that will cover reproduction and the making available to the public of press publications to the extent that digital uses are concerned. The proposed reform has produced a spate of comments and criticism, since it has for the most part been interpreted as unjustified, ineffective and damaging. In particular, the new right appears to be without economic or legal justification, since there is no evidence of a market failure which the legislation would need to solve. The article aims to scrutinize the world of online news and its business models, as well as the complex framework of the much-debated EU copyright reform and the overall effects of the introduction of the new right.
The World Trade Organization’s (WTO) Dispute Settlement Understanding (DSU) favours negotiated settlements for disputes. However,
arbitrations according to Article 22.6 of the DSU have been carried out as compulsory conventional arbitrations, even though
such arbitrations do not offer strong incentives for the parties to reach a settlement. For quite some time, scholars have
studied other forms of arbitration that may encourage settlements more strongly, such as final offer arbitration. Yet this
form of arbitration has received rather limited attention in the academic discussion about dispute settlement under the WTO.
This article explores to what extent final offer arbitration might make sense for settling WTO disputes and concludes that
it would be suitable for arbitrations pursuant to Article 22.6 of the DSU, specifically for setting the level of suspension
of obligations and, under certain circumstances, for deciding on so-called cross-retaliation pursuant to Article 22.3 of the
DSU. Before negotiations start, parties to a dispute should agree on final offer arbitration if arbitration should be deemed
necessary. Such an agreement might be expressed in a pre-emptive joint proposal on procedural aspects. Amendment of the DSU
would then be unnecessary.
This article examines final offer arbitration and recommends its use in court-annexed arbitration programs, which are now operating or being considered in a growing number of federal and state courts. The first portion of the article analyzes the process of the settlement of lawsuits and gives some reasons why settlements are not always reached expeditiously. Next, the article analyzes the final offer arbitration process and shows how it may promote settlement. The last portion of the article examines empirical data on the efficacy of final offer arbitration in promoting settlement. The empirical data comes from two sources: laboratory experiments and field studies. While the laboratory experiments provide strong support for the conclusion that final offer arbitration encourages settlement, the field studies are inconclusive.
Media policy recently has moved dramatically toward deregulation. Probably the strongest and most persistent claim made in defense of this move is that the media should give the public what it wants. This anti-paternalistic goal is often (wrongly) asserted to be implicit in the first amendment and, in any event, to be good policy. And giving the public what it wants would be a result, it is continually asserted, of deregulation and greater reliance on markets.This article challenges that thesis, making three arguments. First, monopolistic competition, the economic model that best describes most media competition, can be systematically expected, at least assuming inadequate price discrimination, to drive out some media entities that are valued by the public (produce media products that the public would want if offered). Moreover, sometimes successful firms will produce less value than the entities that they eliminate would have produced - that is, competition undermines economic efficiency.Second, "what an audience wants" only makes sense economically if described in terms of some resource constraint. The normal constraint is that the purchasers (audiences or audiences plus advertisers) should pay the full cost of media products. Media products, however, routinely produce major positive and/or negative externalities. Consequently, under the standard of giving the audience what it wants, the result is too much "bad" (negative externality creating) media products and not enough "good" content.Third, the normal economic reliance on market measures - preferences expressed in purchases and based on the existing distribution of wealth - may be especially inappropriate as measures of value (or of what the audience wants) for some sorts of media products.Once developed, this critique has overt policy implications. Governmental media policies, which began in the eighteenth century but which recently have been subject to dismantling, can generally be expected to provide the audience what it wants better than the unregulated markets. In fact, the primary problem with the old regime was inadequate scope of government intervention in the media realm.
Many if not most markets with network externalities are two-sided. To succeed, platforms in industries such as software, portals and media, payment systems and the Internet, must "get both sides of the market on board." Accordingly, platforms devote much attention to their business model, that is, to how they court each side while making money overall. This paper builds a model of platform competition with two-sided markets. It unveils the determinants of price allocation and end-user surplus for different governance structures (profit-maximiz-ing platforms and not-for-profit joint undertakings), and compares the outcomes with those under an integrated monopolist and a Ramsey planner. (JEL: L5, L82, L86, L96) Copyright (c) 2003 The European Economic Association.
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