Long-running bid to make big tech pay for news hits a snag

The media minister says a proposed law to get Google and Facebook pay for local news is not dead, but this week a Parliamentary committee and its government MPs did not support it. The government’s media policy is under new management, but still creating confusion in an industry desperate for clarity as well as income.

Hear all about on the issue in this week’s Mediawatch here:  

“We can’t ignore the effect of Google and Facebook on media companies’ bottom lines – and on public media too,” the media minister in the Labour-led government Kris Faafoi told Mediawatch in December 2018. 

“We have had a clear message about the effect it is having on their ability to do regional reporting and local news reporting,” Faafoi said.

Australia’s commerce regulator – the ACCC – had just recommended curbing the market power of the tech titans there and requiring them to compensate local news media. 

Faafoi pledged to investigate following suit here. 

By 2021 a bargaining code was in place across the Tasman which has secured hundreds of millions of dollars in payments, mostly from Google, since then. 

But it wasn’t until August 2023 that Faafoi’s successor Willie Jackson got the Fair Digital News Bargaining Bill before Parliament here. 

The Bill would incentivise digital platforms to do deals with news media and could penalise them heavily if they don’t bargain in good faith. 

But it was too late to progress the Bill before the election last October.  

In opposition, the National Party’s media spokesperson Melissa Lee had called it “a  shakedown.” But when she became the media minister after the election, she allowed it to go to the Select Committee stage. 

One of the few things Lee told the media at that time was that the Bill failed to take account of rapidly developing artificial intelligence applications which could also co-opt local news without compensating the local newsmakers. 

When Lee was replaced as media and communications minister by Paul Goldsmith last month he also said big tech was making the media’s urgent problems even more acute.  

“You’ve got some real challenges with the massive power that the big streaming companies have. Part of the solution is to try and level the playing field as best we can” Goldsmith told RNZ the day he took over. 

Passing the Bill would be one way, but last Tuesday afternoon news that this was now unlikely hit the headlines. 

Reports of Bill’s demise exaggerated?

Photo: RNZ / Angus Dreaver

The Herald reported Goldsmith as saying “confused government MPs” caused a select committee not to recommend the Bill.

Goldsmith’s clarification followed the Economic Development, Science and Innovation (EDSI) committee reporting back with a recommendation the Bill not be passed.

Media reaction was swift – and unfavourable. 

“I’m actually gobsmacked that we’ve got to this point. What were the qualifications of the people sitting on that select committee? Are they a bunch of numpties?” the unimpressed former Christchurch broadcaster-turned-PR professional Ali Jones vented on Newstalk ZB. 

“We need some quick, intelligent, informed decision-making about this. Otherwise, our entire fourth estate’s going to go under,” she said.

“The government actually hasn’t made decisions about what precisely to do with the Bill,” Goldsmith said on air soon after. 

“I’m taking a bit of time to work out what’s the best way through it,” he said, before listing the possible merits of the Bill. 

That message appears not to have got through to the EDSI committee’s two National MPs. 

The EDSI report said the committee’s eight MPs were “unable to agree on whether to recommend amendments to the Bill” so it was reporting the Bill back to the House unamended. The government had already said it didn’t support the Bill in its current form. 

Labour and the Greens both supported it, but Act – whose MP Parmjeet Parmar chairs the committee – didn’t support it due to “potential unintended consequences” which are not specified.

“If the House determines that the Bill should proceed, we encourage it to consider the amendments we explored,” the report concluded.

One amendment allowed for charging online operators if local news was used by their AI technology innovations – something former minister Melissa Lee had previously highlighted as a significant omission.

Having said the Bill was still under consideration, Paul Goldsmith was asked by Newstalk ZB if he would be better off doing nothing.

“Well, that might well be the answer too,” Goldsmith replied. 

Two weeks ago, internal affairs minister Brooke van Velden scrapped a long-running overhaul of media regulation and out-of-date laws, citing fears for freedom of expression. In opposition, the coalition parties also opposed the RNZ/TVNZ merger and the Public Interest Journalism fund. 

On Newsroom.co.nz this week, co-editor Tim Murphy said Goldsmith has been “undone … by National’s media policy vacuum”. 

“He revealed he had asked the committee to delay its report back to Parliament but that approach had been rejected,” Murphy wrote. “And, tellingly, he blamed the failure on “confusion” from his own side – first attributing it to “Government MPs” and then under questioning from journalists refining that to “National MPs”.

So is the Bill really dead – or not? 

Andrew Holden, the News Publishers Association’s Public Affairs Director
Photo: Paul Rovere PTR

No-one is more invested in this than the members of the News Publishers Association (NPA), an umbrella group of news producers and newspapers that doesn’t include broadcasters. 

In 2022, the Commerce Commission gave them a green light to bargain collectively with Google and Facebook. 

“We remain confident there’s a good chance that it will go ahead. If you go back to the (select committee) hearings in February, that was essentially unanimous support from all the media companies but there could be some elements added to it,” the NPA’s public affair director Andrew Holden told Mediawatch. 

But those companies of course all stand to benefit from obligatory deals with Google or Facebook. 

“You can see in the redrafted Bill in the committee’s report that they listened to what was said particularly around Artificial Intelligence. They’ve done a really good job” said Holden, a former editor of Christchurch’s daily The Press and Melbourne’s main daily The Age. 

“I think what’s possible is, rather than the full redraft, some tweaks to the previous legislation. I think it could still progress with minor changes, and if Act doesn’t support it then you would expect Labour would because at the end of the day, it’s their legislation originally.”

“My understanding of the process is that Goldsmith doesn’t have to go to Cabinet. He can make a decision  that he wants to progress and identify what the amendments would be. It doesn’t require that full coalition agreement. 

“There’s an opportunity here for New Zealand to be world-leading. In Australia and in Canada, neither of those (laws) called out AI. But here’s an opportunity for New Zealand to do that and be right up to date with what’s happening in terms of technology and media.”

Another level to pull?  

A Koi Tū think tank report recently recommended amending the Digital Services Tax Bill (also now before Parliament) so that a levy on digital platforms could feed a ring-fenced fund to support media. 

“That bill is designed to try to overcome the tax avoidance mechanisms that these platforms use on an industrial scale. If we simply amend that to make an additional sum available to the media… that would be in keeping with what’s being done in other jurisdictions,” said author Dr Gavin Elllis. 

 “That money would be ring-fenced, and we would have to have an equitable system of distribution that all the media agree to, large to small. That could be the difference between survival and going under.”

A levy on digital services is also backed by lobby group Better Public Media. 

“That’s going to take another 18 months to two years to develop. Who does the levy apply to? How are you going to collect the money? How are you going to distribute it?” said Holden.

“The crisis is now. You can see the number of journalists losing jobs. A number of small papers closing or being absorbed by the big companies.

“So we need some action and an opportunity now to be able to sit down with Google or Meta and have a negotiation. That can be resolved by Christmas. That’s fundamentally what we need.”