Microsoft urges Biden administration to back media bargaining laws

Microsoft president Brad Smith has urged the Biden administration to not stand in the way of proposed media laws that will force Google and Facebook to pay Australian news organisations for featuring their content on their platforms.

Mr Smith is urging the US to adopt a similar model to tackle the competitive imbalance between tech giants Google and Facebook and news outlets in a blog post, as the Australian government prepares to release the findings of a Senate committee hearing on the proposed news media bargaining code.

Microsoft president Brad Smith says it was Google’s threat to exit Australia that “got our attention”.
Microsoft president Brad Smith says it was Google’s threat to exit Australia that “got our attention”.Credit:Bloomberg

The world-first laws, which could be legislated locally within the next two weeks, caught the attention of the Trump administration in September, which raised concerns about the damage it would do to US and Australian trade relationships. Those concerns were reiterated in evidence provided to the Australian government later that year, while the US Chamber of Commerce warned the code “explicitly targets and discriminates” against American companies.

“Google is hoping the US Government will continue to do some of the fighting,” Mr Smith said. “For two years Google and Facebook have successfully been urging officials in Washington to protest to the Australians.”


Mr Smith said the Biden administration had to consider whether it was wrong to compensate news for the benefits tech giants receive from content.

“Facebook and Google persuaded the Trump Administration to object to Australia’s proposal,” he said. “But as the United States takes stock of the [US Capitol attack] on January 6, it’s time to widen the aperture.

Mr Smith endorsed the proposed media bargaining laws last week and told The Sydney Morning Herald and The Age it would increase investment in its local search engine Bing to fill the void created if Google followed through with a threat to turn off its search engine in Australia.

The endorsement prompted a call between Prime Minister Scott Morrison and Google boss Sundar Pichai and a flurry of last minute negotiations between the tech giants and news outlets.

The blog post, published on Friday morning (AEDT), was released after news outlets across the US, Canada and the European Union asked if Microsoft would support similar laws in other jurisdictions.

Under the most recent proposal, the code will force Google and Facebook into binding commercial agreements to pay Australian news providers for the ability to display news content in newsfeeds and search results. Failure to do so could cost the companies fines of up to 10 per cent of annual revenues.

The Morrison government has signalled it wants to move swiftly to pass the code, with a draft parliamentary schedule indicating the bill could be debated in the Senate as early as Tuesday.

Microsoft is not currently subject to the code, but Mr Smith said it would be prepared to sign up if it was required to and also said it had the financial muscle to afford the payments.

Executives from Google and Facebook said last month the bill was “unworkable” but local media companies such as News Corp Australia, Nine Entertainment Co (owner of this masthead) and Guardian Australia are advocating for the code to be legislated immediately.

“As the 21st century began, the internet eroded the news business as dotcoms like Craigslist disrupted advertising revenue, news aggregators lured away readers, and search engines and social media giants devoured both,” Mr Smith wrote in the blog post. “The cure will likely require multiple medicines. But part of an innovative prescription has emerged from halfway around the world.”

“The United States should not object to a creative Australian proposal that strengthens democracy requiring tech companies to support a free press. It should copy it instead.”

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