Learn from Australia: Net companies must pay for media content – Times of India

The media constitute a pillar of democracy. This pillar has been financially eviscerated by internet companies using media content without paying for it. This has enormously enriched internet companies like Google, Facebook and Twitter while bankrupting the media. This injustice cries out for a remedy. We must hail the start made in Australia, where the government threatened to enact legislation forcing internet companies to pay for content. To avoid this, Google has agreed to pay millions of dollars to media companies (mostly owned by Rupert Murdoch). However, Facebook has gone in the opposite direction, banning publication of news.
There are no simple solutions. On the one hand the internet has been a fantastic force for democratising access to information and providing a voice to those who could not be heard earlier.
On the other hand, internet companies have avoided paying copyright fees to content creators on the ground that they are free platforms, not sellers of content. However, they make enormous profits through advertising. It is outrageous that they can make billions while bankrupting those providing content.
India, like Australia, must ensure that the media are healthy and flourishing. This must be done without destroying the democratisation of information by internet firms. Many dilemmas and conundrums need to be resolved before rushing to legislation.
Should internet companies be left free to choose different paths, as Google and Facebook have done? If legislation mandates or strongly incentivises payment, should internet companies be free to strike deals with a few companies and let others wither? What safeguards are needed to prevent the death of smaller media, journals in regional languages, and newcomers? Should we have a law mandating the formation of media consortia that negotiate jointly and share the payments? If some media companies complain that the sharing formula is unfair and needs changing, what mechanisms are needed for fair play? How are media companies investing in excellent reporting or analysis to be paid more than humdrum ones? How do newcomers claim a share of advertising revenue?
Historically, the media have been funded mainly by advertising, not subscriptions. This enabled newspapers that cost Rs 20 to produce to be sold for one-tenth of that rate. With the internet providing free news access to hundreds of millions of users, advertisers have switched massively from print and TV to the net. Indeed, by mining the data of users, internet companies are able to direct advertisements to those viewers most likely to buy certain products or services, something that traditional media cannot.
All newspapers started by offering free viewing on the net. But they were unable to monetise viewership through advertising. Some newspapers have now opted for a subscription model where net access has to be purchased or a hybrid model where some news is free but premium items requirement payment. However, any demand for payment reduces circulation, and hence advertising revenue.
If newspapers are assured a share of the advertising revenue of internet companies, they can afford to go for the subscription model in a much bigger way. Twitter or Facebook links to a newspaper will fail when readers need a password for access, which in turn requires a subscription. Google can’t afford to opt out of news the way Facebook has. Google is a search engine that by definition must access a wide range of sources. It can’t afford to boycott major media sources — that will negate its very relevance as a search engine. Facebook and Twitter are social networks that will have a large number of users even without links to media articles, though this change will antagonise users and possibly look for alternative platforms, which would provide healthy competition. Should future legislation cover only search engines like Google and Bing, or all internet firms? Let’s watch and learn from the fortunes of Facebook and other social media in Australia. This is new territory.
Detailed government rules on such issues could be problematic. Cronyism and favouritism would be eternal temptations. Rigid rules are undesirable when trends, technology and tastes keep changing. Legislation should aim at creating a fair framework within which media and internet firms can negotiate and amend deals. The Australian model provides for arbitration of disputes. In India, arbitration takes ages and is often followed by appeals to courts. Swifter procedures must be devised.
Since the internet crosses national boundaries, countries will have to come together to decide international rules and avoid loopholes. Here again we need a basic international framework for a fair balance between content providers and users, with details to be negotiated at the national level. A new media-internet era has begun. This must be treated as an evolving process, not a one-time event with one-time legislation.

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