Australia fired the first shot with the world’s first News Media Bargaining Code five years ago. Now, many of the biggest deals it triggered are about to expire.
Rod Sims and his ACCC team dragged Google and Meta to the table, and it turned into a very public brawl.
Google threatened to pull its search engine out of Australia.
Facebook hit the nuclear button and blocked news – and in the process accidentally took down health and emergency pages, infuriating millions of users.
In the end, both stayed. Both paid. For three years they pumped roughly AU$250 million a year into around 30 Australian newsrooms.
The code had at least as many critics as supporters – but it had teeth.
Borrowing a trick from American baseball, it included a “final offer” clause: if no deal could be reached, both sides wrote their number on a piece of paper and an arbitrator picked one.
Australia’s lead inspired copycats around the world. Canada used it. Europe took notes. South Africa has just finished its own landmark inquiry.
Chapter One of making tech pay for journalism was written in Australia, and now that’s expiring, it’s time to imagine Chapter Two, so I’ve invited Rod back.
In March 2024, Meta walked away from the code and its local and international behaviour suggests it’s not coming back any time soon.
Google - which put up 70 per cent of the money - has kept paying but shortened its renewals to one year leaving newsrooms nervy.
At the same time, a new Australian government is trying a new idea, that it calls The News Bargaining Incentive.
It’s a tax levy on Big Tech with a simple premise: Pay publishers for using their content or we’ll tax your earnings and you can pay the taxman instead.
And this is happening, as the world-class digital platforms department Rod helped build is being wound down and its best brains are drifting off to jobs - often in tech.
So what does the OG of making tech pay think should happen next? Should AI be dragged into deals now? And what about Apple and TikTok?
That’s why I asked Rod onto the pod, and today he shares his vision for the next phase - some of which are new and surprising.
Before we get there, thank you to paid subs from Le Devoir, Adobe, The Local Media Consortium, and Austrian daily Salzburger Nachrichten, among others.
Also, welcome to new free subs from The LA Times, The United Nations, The School of Journalism and New Media at the University of Mississippi, The New Republic in New York, News Corp Australia, and Spotify, among others.
And thank you to new Substacks recommending Future Media this week including Information-Driven Business written by Deloitte supremo Robert Hillard, and The Intellectual Investor written by financial journalist Vitaliy Katsenelson.
Headlines
OpenAI says teen violated T&Cs using ChatGPT to plan suicide - ArsTechnica
Character.ai is banning teens from its AI companions - Washington Post
97 per cent of people struggle to identify AI music, and it’s OK - The Verge
Moonshot and MiniMax emerge as China’s new frontier AI labs - SCMP
Taiwan raises GDP growth forecast to 7.3 per cent on AI sales - Financial Times
Kill your commute
🫣 Watch: German broadcaster DW interviews whistleblowers who allege Amazon is using “cunning” to force up prices.
📖 Read: Google’s Sergey Brin gives away $US1.1 billion after Google’s market cap surged after soft antitrust ruling.
📻 Listen: Australia’s eSafety Commissioner reveals on Spotify how she expects the world first teen social ban will play out.
The Big Story: What’s next for news media bargaining codes?
Ricky: Hi Rod. Everywhere I go, people ask me about the news media bargaining code. It’s on the tip of everyone’s tongue. It was a giant piece of work.
Some publishers got paid. Some smaller publishers missed out. Tech was furious. Then paid. Looking back, do you think it was a success?
I travel a lot and everywhere I go people ask me about Australia’s news media bargaining code and they’ve all heard of you.
It was a giant piece of work that’s now faced the test of time. Do you think it was a success?
Rod: Yes, I am, Ricky. We had an objective of getting private deals done between publishers and the platforms, and we achieved that - $250 million a year.
It was slightly more than I hoped we’d get, and I think just about everybody who, under the legislation, was supposed to get a deal, got a deal.
Ricky: Let’s go back in time. Publishers weren’t being paid anything by platforms then other than perhaps a share of advertising, so where did this deal come from?
Rod: It came from an inquiry that the previous government asked us to do on the platforms very broadly.
The European Commission had issued large fines, but it wasn’t changing behaviour, so we were asked to do a wide-ranging inquiry to find out what was going on.
It was the first major inquiry into the digital platforms and it unearthed a whole range of issues.
One I always found interesting was that platforms did have market power. That might seem obvious now but that finding resonated around the world then.
And we looked at competition, consumer privacy and media issues. We then made 23 recommendations, one of which was to have a news media bargaining code.
Once we got into the whole area, it was clear that this (situation) was real and really damaging the media.
The platforms weren’t producing anything, but they were taking from those who were and using it to benefit their systems.
It was providing them with quality news that kept people on their platforms, and that allowed them to sell advertising against it.
Yet the news organisations themselves weren’t really getting the benefit from that.
They were losing their content, and not being rewarded for it, which is obviously unsustainable.
Ricky: How many people did you have involved in that inquiry? It sounds like a significant piece of work.
Rod: Probably about 30. People floated in and out; lawyers, economists, as well as the digital platforms team.
Ricky: And did the platforms align to help with this inquiry? What was their reaction?
Rod: Google was skeptical but helped a bit. Facebook - no engagement. But under our laws, we had compulsory information powers.
So we sent them a whole range of notices to find out what they did and how they did it to really understand their business model.
In that sense, Ricky, we didn’t need their cooperation. We could use compulsory information notices.
If they didn’t comply with those, that was a breach of law, and there were serious consequences.
Ricky: What about the publishers? Did the publishers all join in? It can be like herding cats trying to get them to work together. Did they engage with you?
Rod: It was interesting, Ricky. They did, and they did collectively.
Obviously we got information from them individually, but it was very interesting that the media came together.
We had News Corp and The Guardian on the same page, trying to get this done. I don’t think there’s any other arena in which those two would co-operate, but they did on this.
So we had a range; the big publishers, commercial broadcasters, the state broadcaster, The Guardian which was a new digital native, and smaller ones too.
Ricky: Most publishers that I talk to have very nice things to say about you. They appreciate Australia had a first go, and you were a tough cookie. Is that how you see yourself?
Rod: In the right place, at the right time, You know, we were fortunate to be asked to do that inquiry. It was an inquiry we were hoping we’d be asked to do.
There was a lot of work going on in that space and we had the right team - an excellent team - in place that was very determined to get this done.
Ricky: Lots of regulators are now involved in similar inquiries. South Africa just completed its work last week.
I hear similar stories from them all. When you put Google under pressure, it’s charming, but also tough and difficult. Meanwhile, Meta doesn’t come to the party.
What was your experience?
Rod: I think the Google culture is to have very close, warm engagement, and it put forward various options for change which were reasonable from their point of view.
But in the end, we decided it wasn’t enough so we pressed ahead with the bargaining code.
Facebook, fairly early on, said none of this had nothing to do with them. It didn’t want anything to do with it and, after a bit of early engagement, broke off the engagement.
There were very different corporate approaches.
Facebook was always angry and hard to deal with, and as I said, it broke off the engagement. Google stayed engaged throughout.
Ricky: You had regulated several difficult industries and monopolies before this. How did tech compare to say banking?
Rod: Tech was being regulated for the first time, whereas banks, telcos are used to it.
That’s why I think Google approached it in a very positive way. Facebook was just stunned that anybody would want to regulate them in any way.
So it was a bit different, yes, but I hope that Rubicon’s now been crossed, and that they’ll become more used to regulation.
And that’s because they have to, given the role they play in society, and of course, it’s going to be beefed up enormously with AI.
Ricky: You delivered a solution that paid publishers ~$250 million-a-year, and then after three years, Meta pulled out. Were you surprised?
Rod: Google’s deals were five users, and they run out mid-next year, largely. Meta’s deals were three years.
And yes, Meta was signalling (its intention to pull out) in all sorts of ways, mainly overseas.
We were following comments made in America that it would not do these sorts of deals, and so when they pulled out, it was no longer a surprise.
The Canadians tried to implement a code and Google engaged, but Facebook just wouldn’t, and to avoid it, it took down all media content from its platforms.
So we knew where Facebook was coming from before it didn’t renew the deals.
Ricky: Under the news media bargaining code, there was a clause to designate the platforms if they pulled out. Can you please explain what meant?
Rod: Yes. The news media bargaining code is the law of the land, but to trigger its powers, it requires The Treasurer of Australia to designate a platform.
Once designated, it’s required to negotiate deals with media companies - and all media companies. It can’t just pick some. It’s all.
And then, if agreement can’t be reached, it goes to arbitration. We used what’s called baseball arbitration.
That means the arbitrator can choose one side’s bid, or the other side’s bid, but can’t combine them. It has to pick one - and hopefully that drives sensible bids.
What happened in Australia is that Facebook took down news and said, that’s what we’re going to keep doing if you keep going with this law.
Google also threatened to withdraw its services from Australia, but in the end, they both backed down.
Google did so partly because Microsoft said straight away that it would boost up being in Australia and take the place of Google.
And Facebook overplayed its hand, and when it took down news, it also took down pages on bushfires and medical advice, and a whole range of things that caused outrage in the community.
With that, The Treasurer negotiated an arrangement where he agreed he wouldn’t designate the platforms if they went and did deals quickly. And they did that.
I think they did it because they wanted it seen around the world that they were never covered by the news media bargaining code and what they did was voluntary.
But it wasn’t voluntary - the threat was designation - but from our point of view, we got a lot of deals done much faster than we would have otherwise.
We were pleased with that outcome. They weren’t designated because they did deals, but the code still exists, and Google could still be designated to keep the deals going.
Ricky: What about Meta though? It ended the deal and hasn’t been designated. Why not if the law exists for just that purpose?
Rod: The government’s been thinking hard what to do, I guess. The government could just get Google to continue. It was 70 per cent of that $250 million (for publishers).
As far as publishers are concerned, that’s a lot of money continuing, so the news media bargaining code could keep going on just with Google.
But a problem with the code, which I guess perhaps we didn’t realise at the time, is that it says platforms are only covered if they show news.
Facebook said it wouldn’t show news in Canada and threatened to do the same here if designated. If it did that, it wouldn’t be covered and designation would be useless.
What it did in Canada showed that’s exactly what it would do, so there’s no designating. It’ll just take news off their platform.
The government’s been working out what to do and how to respond to that.
Does it just continue the code with Google, or come up with something different that picks up Facebook? And now TikTok and a few others too.
What the government has decided to do is look at a News Bargaining Incentive. It tells platforms to do deals or they’ll be required to pay a certain amount of money.
Call it a tax if you like, or a levy, and the government will take that money and distribute it to the media.
That’s not something we could have done up front, because we didn’t know what the platforms’ payments were going to be.
Now we know what’s been paid to each media organisation, so the government can actually do it now.
I can tell the platforms what the levy is that they have got to pay, and it’s pitched the levy at an amount that’s more than the platforms are paying now.
The government doesn’t want to collect the levy. It wants to get the platforms working back under the news media bargaining code, so it’s a forcing device to do that.
We’ll see how it plays out, Ricky, but it’s a good move by the government, and I’m very strongly supportive of what the government’s done.
Ricky: It’s fun to design it as an incentive: We’ll charge you more in tax than you’ll pay if you pay the publisher. Is that fair shorthand?
Rod: That’s right. Pay the publishers through privately negotiated deals. And private is a crucial bit.
When the deals that were done, I was not involved in them. That would have been inappropriate.
But chatting to some of the dealmakers at various times, I learned these were detailed deals, bespoke to each publisher.
What the publishers got, and what the platforms gave up, were not just payments, it was all sorts of things which were valuable.
What we want now is negotiated deals with each publisher, and now we have a great benchmark from the code for what Google and Meta can do.
And now if we bring in TikTok, and Apple News, we have a rough benchmark of what they should be providing as well. I say, we, but I’m out of it now.
Ricky: You just mentioned TikTok and Apple News. There are now more platforms emerging all the time. Should they all now be brought in and forced to negotiate?
Rod: Yes. If you’re going to do this, then it should apply equally without favouring one lot over another. You want the platforms to have news on their platform.
And when I say news, I mean written by journalists who know what they’re doing. That’s different to a random blog.
This is about news stories written by journalists. That’s what matters.
So, yes, they should, but of course, the same issue arises with AI, so we have more organisations that should now be called, and the new law, the incentive, includes that capability.
Ricky: You’ve been very generous with your time with me recently, but I’ve never asked you this before.
Put yourself in the shoes of a publisher headed into a negotiation with the platforms.
It’s going to be tricky and potentially existential. A bad deal could prove to be fatal.
Publishers often ask me for the benchmarks. What should I be asking for Ricky? What are the gotchas? What kind of numbers or percentages should we shoot for? They’re asking for a blueprint for a deal structure.
Now, my understanding is that under the terms of the deals you’ve alluded to the terms were all private. All signed behind closed doors.
Is that what you think should happen, from a competition perspective? Or should there be a general blueprint that others can build on?
I ask because not everybody has a great negotiating team, and smaller publishers will not have the same leverage.
What are your thoughts on that? Should it be secret or should it be shared now?
Rod: We wanted them to be secret because they were private commercial deals. We were trying to replicate what would happen in a normal marketplace.
And what we got was a deal between the ABC or The Guardian and Google and Meta on the other.
That’s a deal that should have been happening anyway, so we were trying to replicate that market, but I understand the blueprint point.
The News Media Bargaining Code said the platforms had to do a deal with everybody.
Everybody had leverage. The platforms couldn’t just do a deal with the five or six major players. They had to make a deal with everybody.
Country Press Australia, which I think has about 180 very small publications owned by 60 players or so, collectively bargained, which is allowed under Australian law.
Ricky: Let’s not miss that. That was really important, right?
Rod: Yes, very important, and automatically allowed under Australian law. So it was able to get a very good deal. Dollars per journalist, it probably got the best deal of all.
Their leverage came from the law requiring the platforms to do a deal with everybody, and that was the important part.
Now, let’s go to your point about the blueprint. Yes, I get that. I think there may now be a way to do that.
I was comfortable with what we did before, but I get your blueprint point. I think there may now be a way of having some aggregate information out there.
I mean, you don’t want to publish the contracts. That would be disastrous. But giving some idea of who got what would, I think, be useful to provide that benchmark.
How that’s done, I don’t know, but I’m very confident you could do it to provide that benchmark.
You could list say five deals that were done at different revenue levels where you kept the names of the players confidential.
You could then provide that blueprint, and I think that probably that should be done.
Ricky: You said the NMBC was designed for every publisher to get a deal, but there were some complaints from smaller independent publishers who felt excluded
How do you square that, and how do we cater for them in the future? How do we balance it?
Rod: I think we did balance, and it’s really important.
The bargaining code said a deal had to be done with everybody who publishes public interest news or public interest journalism.
There were some publishers that were sports publications and we took the view that they were not publishing public interest news. Judgments were made about who was in and who was out.
In my discussions with people close to the media, those without a barrow to push, they felt that just about everybody who should have got a deal, did get a deal.
Look at Country Press Australia. There was another one that collectively bargained for foreign language publishers; Chinese, Italian, Greek, Indian… They got a deal.
It wasn’t brought to my attention that there was someone out there who clearly should’ve been in, and who didn’t get a deal.
There were marginal cases, and obviously, if you’re in that category, you’d violently object to what I’m saying. You’d say, of course we publish news.
But it was all about the news. It wasn’t about publishers. You had to be actually conveying news.
My second point is with the News Media Initiative. It has a clause that says the platforms don’t need to do deals with everybody, just with an even spread.
It even caps the amount of a deal you can do with any one player to provide that even spread.
It says to platforms they must spend this amount, but they can only pay this amount to big players.
I’m going to be arguing very strongly, that they should spread (the spend to smaller publishers) and use the same language as the NMBC: Everybody should be covered.
Ultimately that’s what the law says, and I don’t think anybody should be held to ransom. The government has enough benchmarks, and the arbitration process.
At the end of the day, if someone overplays their hand, you can take it to arbitration.
And the beauty of the baseball arbitration is that they can’t go to the arbitrator with a ridiculous bid, because the arbitrator will side with the other player.
That’s my one criticism of the news media initiative. With the NMBC, everybody got in and a lot of small players got deals.
Ricky: Last question on the NMBC. Do you think it was enough money?
Rod: It was slightly more than I had calculated. You might ask how I did my calculation, well here it is. It was pretty rough.
It looked at how much media publishers were paying their journalists and editorial staff, and asked what was a reasonable percentage for the platforms to be covering.
The benchmarks said clearly that covering 50 per cent of media costs was probably too much, and five per cent was too little. I settled somewhere in between.
And lo and behold, the deals came to be about 25 per cent of their journalism and editorial staff costs. And there’s your benchmark, if you like.
I think that helped guide the negotiations to a sensible place.
Ricky: So the world’s moved on and now we have AI. You and I have spoken several times so I’d like you to cast your brain forward to what we need to do next.
AI is clearly a gamechanger. Publisher content’s being taken and used in search with no clicks coming back.
That means another part of the media industry’s earning mechanism is being dismantled.
If you were ACCC chair again today and you were facing that AI challenge, how would you be thinking about it?
Rod: Pretty much the same, only more strongly, Ricky. AI, ChatGPT has said it wants to be the home for everybody. All apps would be there, you won’t need to leave.
It gives you answers to questions often without links, summarising…
If you want to know what’s going on with the war in Ukraine, you’re going to go to the media, right? ZBecause they’re the only ones covering it.
There’s no learned or academic articles up and about that. You rely on the media, and there are so many issues like that.
So, I think the same principle applies. OpenAI is using people’s content without payment to benefit its own service.
And that means we won’t have any media any more except very large players behind paywalls where people have to subscribe to the content.
The easiest example is The Economist. It charges a lot of money so you’d think The Economist will be OK.
A few others may be OK too, but most others won’t because their content is being taken for no payment, and that’s just not sustainable. It’s the same.
And the same process could apply. It’s not hard to do. All the processes are in place. You could bring the big AI platforms under the code in just the same way.
You could use the bargaining code, or the news media initiative, whichever works. It may need a bit of adjustment, but the template is already there.
And there’s no way AI can exist without media content. Google cannot exist without media content. You can’t have a search that doesn’t rely on content.
Facebook had a news feed once upon a time, but it dropped the news and called it the feed as soon as we (the ACCC) came along.
Meta clearly judges that it can get away with not giving its users news. Interesting… but that’s the judgment it’s made.
But you can’t have an AI platform without news. I mean, you just can’t. It’s meant to give answers to queries.
Some queries, like the price of a good pair of running shoes - OK, you can get away with that.
But most queries need news because they’re about news so AI will go to them.
I think even the news media bargaining code would catch the AIs if they were designated, or even threatened with designation.
Ricky: I’m hearing that you think the AI companies must be involved in future bargaining codes. They have to be. Is that what you’re saying?
Rod: Have to be. They’re completely dependent on news for their service, so they should pay for that.
If they’re not covered, then the media is threatened, and once you threaten the media, you threaten democracy. So, it’s a big issue.
Ricky: I just spoke to the head of Google News, Richard Gingras. He speaks of being a strong advocate for news but was also the boss of Google News.
My response was to push him on the definition of value. Is the value measured in news’ ability to attract advertising, or its value in people’s need to know..
If value is measured purely monetarily then his argument makes sense, but if you’re seeking to share knowledge, inform voters, and make good decisions, it’s different.
Did you come up against that paradox when you were working with the platforms? Did you experience that strange disassociation they seem to have?
Rod: All the time.
If you’re searching Google for what’s happening in the Ukraine war, you’re not likely to see brands advertise on that search, versus searching for running shoes.
I get that.
But Google’s whole service - the reason users join its platform - is so they can ask about the Ukraine war and get that information. It’s essential to the full service.
Yes, item for item, they’re probably not getting advertising against news, but it’s a bogus argument.
Now, the interesting thing Ricky, is this… Would Google care if there was no news on its platform? No public interest journalism at all? I think the answer is yes.
Because if (Microsoft) Bing and DuckDuck had public interest journalism, and Google didn’t, Google would lose, and it would care about that.
But if no search engine, or AI, had public interest journalism, would they care about the damage that did to society? I don’t know. I don’t know.
“Here, I think, is a role for the government. I think you need to say to them that they must carry journalism.”
If these platforms are going to be as all embracing as they want to be, then getting back to the logic of the news media initiative makes sense.
To have a functioning society, we want our AIs, our search engines, our social media, to give people access to quality public interest journalism.
If they’re not getting that, then society loses.
So I think that one entity wouldn’t want to compete without it, but if none of them had it, it would not be clear to me that they care. I think there’s a clear role for the government here.
Ricky: If you’re a broadcaster, the government has rules that say you must invest in making a certain amount of educational content. And news content, and kids shows and so on.
That must carry regulation has existed in broadcast for decades, but it doesn’t exist in digital. Maybe we make public interest journalism a must carry requirement for platforms.
Which brings me back to something you mentioned earlier on, which was Microsoft offering to leap into the gap if Google made good on its threat to leave.
At its antitrust trials, we learned that Google controls 91 per cent of global search, and after Microsoft spent $100 billion, it only achieved a three per cent share.
Even Microsoft couldn’t make an impact. The CEO Satya Nadella described competing in search as the biggest no fly zone in Silicon Valley.
That’s monopoly, but if Google decided to exit the space, Microsoft suddenly has an opportunity. So does DuckDuckGo, and Ecosia, and Brave.
In your former role at the competition commission, wasn’t that your role? To create tension in the market to try and get competition?
Rod: It was certainly the backdrop to the work we were doing, but the Google Microsoft thing was fascinating.
The Google thing was an amazing story. Google threatened to pull out of Australia on the Friday as the legislation went through.
As the CEO of Google in Australia was delivering that news, she looked terribly uncomfortable. We discovered the next day she had a baby just days before.
But the CEO of Microsoft phoned the Australian Prime Minister the day after and told him he could provide that service.
So, yes, Microsoft saw it as an amazing opportunity to make inroads into Google’s share, which was about 95 per cent in Australia at the time.
That was something Google couldn’t allow because once it lost its dominant position in one market, it would set a benchmark for other markets.
But the fact that Microsoft’s CEO called our Prime Minister the next day indicated how important this was - and Google had no option but to back down, which it did.
So, absolutely, yes. Competition drives our market economy. If we don’t have competition, we’re in a dreadful place.
Ricky: I wrote in the first newsletter in this Substack that Google’s challenge was Microsoft opportunity. I urged publishers to pivot to focusing on Microsoft.
If publishers provided a benefit to Microsoft - could be market share in search, or grounding AI - it will see the opportunity and provide strong support.
I still think that opportunity exists, so let me ask this as my last question.
We have increasing numbers of competitors in the marketplace. There’s also the rise of AI. The bargaining code has become an incentive.
We have all manner of different moving parts happening. Consumer preferences are changing and devices are evolving and changing.
And just as this is happening, the government is cutting jobs in your former team, the platforms division at the ACCC.
Surely this division is about to be the busiest it’s ever been managing changes in technologies that are now so large that they are drivers of our national GDP.
It feels an odd choice to do that now of all times.
Rod: I think the way these things work, Ricky, is that it’s not so much a choice as the fact that governments provide budgets for set periods.
In the case of the digital platforms branch, that was for five years, and that runs out at the end of next month. Given that, the platform branch has just wound itself down.
Some people have left. Some have gone elsewhere in the ACCC. Some have gone to work for the platforms and the AI companies. It’s no surprise, they’re well qualified.
“It’s not that the government made a decision. It’s that it didn’t make a decision. That’s the problem. It’s the inertia. It’s the lack of urgency on the issue.”
It just sort of let it drift and brought about this situation. I’m trying to put a bit of focus on it so the government gets moving so we can re-establish the unit.
But there’s no doubt that we’ve lost something with those people going away, and that’s-that’s a real shame.
Ricky: Can it be recovered? Is this something that can be rebuilt?
Rod: Look, it can be rebuilt but it takes time. Not too much time. We’re getting a lot of younger people, 20 and 30s, who’ve grown up with these issues.
They’ve grown up with platforms and social media and are quickly adapting to AI.
What we need is people who have an affinity for the technology, and people who are really smart. So, look, they’ll come back. It’ll just take a bit more time.
But first of all, we need the government to make the decision to bring them back, and I’m hoping over the next few months, we’ll get it.
It’ll be an awful situation if the government doesn’t.
Ricky: That came up at the Meta antitrust trial last week.
The judge decided not to break Meta up because during the five years it took for the trial to happen, the market had changed, so it got off.
There’s always going to be a disparity between the pace of government and the pace of tech companies.
Tech is famous for moving fast and breaking things. Governments are famous for moving slow to try to fix things. Is that a natural tension?
Rod: Oh, look, it is, but the way you address that is by having regulatory regimes like the one they have now in Europe.
Europe decided that acting when tech breaks the law and taking them to court, and the year to prepare for that, cannot work.
Its decision on upfront regulation and brought in The Digital Markets Act. The UK did the same with its special market status regime.
Explained: The Digital Markets Act (DMA) tells Big Tech it’s too big so the European Union has issued a blanket law of ground rules up front.
No more long court cases; instead a list of dos and don’ts baked into the law. Break the rules, and fines are 10 per cent of global turnover - or even more if it happens again.
The UK’s special market status is basically the same. Under Britain’s Competition and Markets Authority (CMA) and has a similar fines system entrenched in law.
Both are designed to name the tech companies covered, and then move right to action without a need for long court battles.
Rod: The ACCC recommended this should apply in Australia more than three years ago, so I’m hoping the government will adopt that regime and bring back the 30 people, or perhaps more, to run it.
Then, will be able to move as quickly as the platforms do. We need to have upfront regulation with people who are focused on the issue.
They should sit with the competition regulators. They can go on the journey and evolve as the platforms evolve and bring in appropriate regulation as it’s needed.
Ricky: Something you said to me the first time we met was that there’s a big difference between a regulator and an enforcer.
You told me the tech companies love to talk about enforcers. They say they’re working with enforcement authorities on this, or we’ve spoken with enforcers about that.
It’s always enforcer, but never regulator. Explain again why there’s a difference, and why tech companies loathe regulators.
Rod: Enforcers enforce the law once they see a breach. They take a company to court but to win, they need to narrow the case down to what it did wrong.
They are unable to talk about the bigger problem. Regulation tells companies up front what they can and can’t do.
Telecommunications is the obvious comparator. We had this same debate about telco 30 years ago. Did we use competition law, or regulation?
We chose regulation. So did Europe, and the United States. There are whole agencies set up to regulate telecommunications. That’s regulation.
So, yes, many consider it to be a dirty word, but does anybody seriously think we should stop regulating telecommunications, or energy, and leave it to enforcement?
Of course not. Everyone understands we need to have rules. We have to drive on a certain side of the road. You have speed limits.
That’s regulation, and you need it to get proper behaviour, and it’s happening. It’s absolutely fundamental. If you have that, you can react to fast-changing circumstances. It’s very important.
Amazing. Rod, thank you for your thoughts and your work.
