Defined: Australia’s Seven West Media’s take care of Google – its significance and influence

Australia’s Seven West Media was the country’s first major media group to sign a licensing agreement with Google that would pay a flat fee to include outlet news on its search pages. The deal comes against the backdrop of a new regulation proposed by Australia that would force social media companies like Google, Facebook and other online tech companies to pay to have news on their feed.

Why is the deal important to Google and Australia?

The deal with Seven West Media, one of the largest publishing houses in Australia, could mark the beginning of a de-escalation of the stalemate between the government and the search engine major. Although the terms of the agreement between Seven West Media and Google are not yet known, experts say it should pave the way for other deals between large media conglomerates.

In July 2020, as part of its efforts to combat the growing power of companies like Google and Facebook, the Australian Competition and Consumers Commission (ACCC) suggested that media companies negotiate payment terms for their articles in newsfeeds from online tech giants.

This effectively means that if Google and Facebook included certain news from media companies on their platform in various services such as Facebook Newsfeed, Instagram, Facebook News Tab, Google Search, Google News and Google Discover, the media company would have to pay for one certain amount.

With large numbers of internet users now getting their daily news bulletins through these tools, rather than visiting the media company’s website or social media handles directly, the ACCC suggested that it was only fair to pay such media organizations for the news. This amount, based on the deal they make with individual companies, can be done either per click on the link or as a fixed amount per month or per year.

“We are not trying to protect traditional media companies from the fierce competition or technological disruption that we know will benefit consumers. Rather, we want to create a level playing field in which market power is not abused and the production of original news is adequately compensated, ”a non-partisan economic legislative committee of the Australian Senate said in a report last week.

Does it affect the inclusion of messages from Google and Facebook in other areas?

With their global presence, Google and Facebook are likely under pressure to pay for the news content they use in other countries as well. In countries like France, the search engine giant has already signed contracts with news publishers to pay for the news included in its search feed.

That said, Google made an initial $ 1 billion investment in October last year to launch Google News Showcase, a product the company said would benefit both publishers and readers. Following the deal with Seven West Media, Google said it had similar payment agreements with 450 news publishers around the world.

Although Google claims to have offered similar offers to other news and media outlets around the world, governments in different countries are likely to review these offers to check the company’s balance of bargaining power. For example, the European Union is also likely to propose a law that will force large tech companies to pay for the content they use, despite what Google offers.

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Although Facebook said it would deprive the user of the ability to post news on their feed if they were forced to pay media, experts believe Google’s deal with Seven West Media could force Mark Zuckerberg’s company to rethink their strategy.