Australia could become the first country in the world to force digital platforms like Facebook and Google to pay for news.

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That prospect is being held up after Prime Minister Scott Morrison has adopted many of the reforms suggested by the ACCC's 18-month Digital Platforms inquiry for a crackdown on Big Tech.

But it is only a prospect, giving Facebook and Google 11 months to come up with a voluntary code of practice, which could potentially head off the reforms.


The Aussie PM did agree to a request from the ACCC (Australia's equivalent to our Commerce Commission) for a new special unit to monitor digital platforms. Morrison said the unit would get A$26.9m ($27m) in funding to undertake a series of inquiries, "starting with the supply of online advertising and ad‑tech services."

The ACCC's Digital Platforms report, focused primarily on Google and Facebook, whom it said accounted for 71c of every dollar spent on digital advertising in Australia. There was a risk that the pair's market dominance in digital advertising was undermining media's ability to deliver quality news, which it saw as critical to the effective functioning of democracy, the watchdog said.

It also raised concerns in a range of other areas including privacy, and Google and Facebook's closely held algorithms and what it saw as general lack of transparency that made it hard for advertisers to gauge if they were getting "value for money."

If Facebook and Google can't reach a voluntary code agreement in negotiations led by ACCC chairman Rod Simms, they could have to spill their ad algorithm secrets, and be compelled to share revenue from ads around content uploaded by media to the likes of Google-owned YouTube - effectively compelling Google and Facebook to pay for news content.

A proposed tightening of privacy laws would mean people will have to receive notifications about what data is being collected about them and how it's being used, and would give them the right to erase it.

"The companies are on ­notice," said Treasurer Josh Frydenberg, who announced the reforms along with Morrison and Communications Minister Paul Fletcher.

"The government is not ­messing around, we will not hesitate to act."

However, some Big Tech critics were disappointed that the status quo would last for at least another year as the voluntary code negotiations dragged on.


And while most of the ACCC's reforms were adopted, Morrison's government did not take up a suggestion for tax-breaks to encourage philanthropic support for journalism, nor a recommendation for a mandatory code that would require digital platforms to detect and take down copyright-protected content.

Google and Facebook both said they support greater competition and will work closely with the ACCC.

"We support a sustainable news ecosystem which is why we work with publishers to help them reach new audiences," Mia Garlick, director of policy, Australia and New Zealand at Facebook, said in an emailed statement.

Aussie govt on front-foot, NZ on back-foot

The Digital Platforms reforms come in parallel to other enforcement action, which in general has contrasted with a more back-foot stance on this side of the Tasman.

The ACCC recently filed a Federal Court case against Google, alleging it misled consumers into thinking they had disabled location-tracking - when, in fact, the search-ad giant was still able to track every move they made. Here, the ComCom is keeping a watching brief.

The Australian government passed a tough new law in the wake of the Christchurch mosque massacres, allowing social media platforms to be fined up to 10 per cent of their revenue or their executives jailed for up to three months if they fail to remove "abhorrent violent material expeditiously."


And a "Google tax" crackdown on profit-shifting was implemented across the Tasman while our government is still weighing whether or not to introduce a similar measure.

Wait - a hint of front-foot

But our government did go on the front foot yesterday as NZ First leader and Deputy Prime Minister Winston Peters cited the social media giants' "suffocating" effect on New Zealand media companies as he throw his support behind NZME's renewed bid to buy Stuff.