Big Tech is on watch with Australia’s new media bill. Introduced to parliament in December 2020, the new bill “will pass into law fairly soon” and require digital platforms to pay for news. This means that companies like Google and Facebook will have “to pay local media outlets and publishers to link their content,” according to CNBC.
Paul Fletcher, Australian Minister of Communications, Urban Infrastructure, Cities, and the Arts, spoke with CNBC’s “Street Signs Asia” about the new law, saying the government expects large companies like Google and Facebook to comply with the bill. “The democratically elected government of Australia expects that businesses that are doing business in Australia will comply with our laws.”
How Much Does Each Company Pay?
According to the bill itself, each digital platform must make an offer to each registered news business corporation (RNBC): “the agreement specifies that the responsible digital platform corporation will ensure the payment of remuneration to the covered RNBC (or a related body corporate of the covered RNBC) for the making available of the registered news business’ covered news content by one or more of the covered services, in respect of the covered period.” Any offer made by a company then becomes a binding agreement.
Essentially, the amount paid is determined by an offer made by the company in question (Google, Facebook, etc.) to an RNBC, and it is then either accepted or declined by the RNBC.
What Kind of News Are They Paying For?
The bill defines all covered media content as “core news content” or “content that reports, investigates or explains current issues or events of interest to Australians.” Essentially any news that a user could get through a basic Google search or scroll through their Facebook feed would be regulated by this law. This has executives at Google and Facebook concerned.
What Does this Mean Going Forward?
According to CNBC, Google could pull its search engine from Australia entirely, despite its 94.5% market share. This move could allow other companies such as Bing or DuckDuckGo, to expand their reach and user base. Facebook (and FB-owned companies) have also come out saying they could prevent Australians from sharing news on their social networks.
Google CEO Sundar Pichai met with Fletcher as well the Australian Prime Minister, Scott Morrison, and Treasurer, Josh Frydenberg, to discuss the bill. During the meeting, it was made clear that Google would have to comply with the terms if they wanted to maintain a presence in Australia.
“We have seen from time to time over the last few years, big tech companies — typically U.S. tech companies — make threats about leaving Australia if they weren’t happy with our regulatory settings,” Fletcher said.
According to The Guardian, Tim Berns-Lee, who invented the iconic world wide web (WWW) in 1989, said this new media bill “risks breaching a fundamental principle of the web by requiring payment for linking between certain content online.”
Berns-Lee went on to say that blocking a user’s ability to share links with other users was a core value of the web and requiring companies to pay for that privilege was considered a world-first provision.
“If this precedent were followed elsewhere it could make the web unworkable around the world,” he said. “I therefore respectfully urge the committee to remove this mechanism from the code.”
Google and Facebook are the primary targets of this bill, since they make up 80% of the advertising spend in Australia. Facebook appealed to the Australian Senate committee, arguing that the new regime created by the bill was “complex, unpredictable and unworkable for our business.” They even suggested that such a bill runs “contrary to the Australia-US free trade agreement,” echoing a similar concern from the US government.
Google also believes the code is unworkable, and “would break the way search engines and the internet work for everyone.” It even proposed that their search engine be exempt from Australia’s new code.
According to Financial Review, Microsoft’s president, Brad Smith, thinks the media bill helps “level the playing field” between Big Tech and news media. He said he would make sure Microsoft complied with the order and was willing to sacrifice profit if the US government decided to adopt a similar bill.
STX Entertainment is merging with Eros International, India’s largest film studio, after a “trying year,” according to Variety, and will henceforth be known as the Eros STX Global Corporation. In 2019 viewers saw some midbudget films from STX, including “Hustlers” and “Ugly Dolls.” The merger with Eros International will bring both studios into a higher financial bracket, currently slated around $300 million for future revenue.
What This Means
Merger specifics include a “stock-for-stock” and publicly traded, independent content. Eros STX Global is currently set to remain on the New York Stock Exchange, according to Yahoo Finance and will maintain offices in Mumbai and Burbank. The newly consolidated company will also have a new distribution presence in the United States, India and China.
As new content is created, existing partnerships with NBCUniversal, Google, Apple, YouTube, Amazon and Microsoft will expand. Eros STX Global Corporation 2020 slate consists of 40 feature films and over 100 hours of original episodic content.
New team members are excited. Robert Simonds, the new Co-Chairman and chief executive officer, spoke with Variety about the now vast resources the companies have brought to the table.
“Together we will have the relationships, management expertise and resources to create new content and grow rapidly in the largest and most attractive global markets,” said Simonds. “On Day One, we will have the ability to tap into our significant combined libraries and draw upon our deep relationships with A-list actors, directors and producers across the globe to create even more compelling content for millions of consumers.”
As a combined entity, the company is excited about creating new opportunities in China. Although STX has had limited success in China, Eros aims to bridge that gap. Eros has a good track record in distributing successful Indian films in China. Eros India CEO Pradeep Dwivedi explains that “Asian sensibilities of movies are very different from American sensibilities. There is a certain understanding of the cultural ethos of China that we believe we can work with much better compared to STX.”
Taking a cue from the ongoing success of super-hero films, the company is also keen on building franchises based on stories from Indian mythology, eliminating the socio-religious aspects and adapting them for universal appeal much like the DC and Marvel models.
While STX’s recent film releases have garnered some attention, this union with Eros will serve to strengthen their viewership. Eros Now, a popular streaming platform, brings in roughly 188 million registered users around the globe. This association will increase that market share.
The existing Eros Now platform deals with Indian content, it plans to soon launch a standalone English-language subscription based offering. In March, Eros announced that it had signed NBCUniversal to join this tier. STX content will follow.
Eros also has a new technology deal with Microsoft. As part of the tie-up, Microsoft will build an online video platform for Eros using Azure technology, which will offer interactive voice search features in multiple Indian regional languages. It will also create an AI-powered platform that will enable high-speed subtitling and translations of Hollywood content. This will be available to customers in price-sensitive mass markets like middle India, Africa, Latin America and migrant workers in the Middle East.
Eros STX Global Corporation plans to complete the merger by the end of second quarter, 2020.