Microsoft backs Australian ‘Link Tax’ that Google and Facebook claim will ‘break the Internet’, with a 5-point FAQ

Microsoft Australian Link Tax
Microsoft wants Australian Link Tax? Pic credit: Tawanda Razika/Pixabay

Microsoft appears to have lent its might behind Australia’s new policy for content aggregators such as Google and Facebook. The company has come up with a new five-point FAQ. It attempts to dispel common conceptions about the new ‘Link Tax’.

Companies like Google and Facebook are actively opposing Australia’s new policy for news aggregation services. These tech giants have claimed that the southern continent’s proposed Australian media code would “break the internet”.

Microsoft releases a five-point FAQ to address claims and alleviate concerns about the proposed Australian media code called Link Tax:

Microsoft has turned into one of the staunchest supporters for a new proposed Australian media code. The media has unofficially dubbed the proposal as a Link Tax.

Google claims it would break the internet. However, Microsoft insists funding newspapers is “important for the health of democracy and fighting fake news.”

The company has now published a 5-point FAQ.

  • It levels the playing field between news publishers and Google and Facebook
    • For the first time, under the code smaller news publishers will be able to join together and collectively negotiate a fair share of the billions of dollars Google and Facebook make from using their content.
  • News publishers will be paid a fairer share of the revenue their content helps generate.
    • The current bill doesn’t include a pay-per-link model. And it won’t “break the internet.” While early discussions included such ideas, policymakers dropped them a long time ago. The current proposal instead requires that tech gatekeepers pay a fair price for news by requiring that they compensate publishers based on the benefits they derive from including news content on their platforms.
    • The proposal requires negotiations between tech gatekeepers and publishers and arbitration if those negotiations reach an impasse. An arbitral panel can then make a final determination. They could base the decision on an assessment of the benefits derived by each side in having the news content included on these platforms, the costs of producing this content, and any undue burden an amount would place on the platforms themselves.
    • All this is important because today Google and Facebook control about 81 cents of every dollar of digital advertising in Australia.
  • It benefits smaller and independent news publishers.
    • There is a relatively low threshold to participate. Any Australian news publisher making at least $150,000 per year can register for payments by Google and Facebook – that’s an estimated 100 to 200 publishers, including local and independent news publishers.
  • News publishers will know when a change is made that will impact the discoverability of their news content.
    • How news content is shown or ranked in search results and on social media feeds can impact how many people visit the site, sometimes by as much as 50%. If Google or Facebook want to make a change, the “dominant purpose” of which is to change the distribution of content and “the change is likely to have a significant effect on the referral traffic to covered news content,” they need to give news publishers advance notice.
  • It prevents retaliation against news companies for trying to get a fair deal.
    • Another way the playing field is leveled is by preventing Google and Facebook from discriminating against news publishers or their content based on whether they are registered to participate under the code or how much they get paid.

What is the Australian Link Tax?

The Australian Government has strongly opined that companies like Google, Facebook, and others, profit immensely from the content that news publications painstakingly create. The government insists that online internet companies must share a part of their profits with the news publications. Technicalities aside, the proposal attempts to force these tech giants to pay news publications a share of their profits.

Practically speaking, the proposal could be a tax of sorts on Google and Facebook. It could be similar to the TV License that’s prevalent in the UK. TV owners in the UK have to pay a £157.50 tax per year to support public access TV and news.

However, the Australian Government is attempting to levy the tax on trillion-dollar companies rather than the citizens of the country. The government claims the Link Tax would benefit many more companies than just the state publisher.

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