The Fair Digital News Bargaining Bill Revived

Child as he was he was desperate with hunger, and reckless with misery. He rose from the table; and advancing to the master, basin and spoon in hand said: somewhat alarmed at his own temerity:

“Please Sir, I want some more.”

The master was a fat, healthy man; but he turned very pale. He gazed in stupefied astonishment on the small rebel for some seconds, and then clung for support to the copper. The assistants were paralysed with wonder; the boys with fear.

“What!” said the master at length, in a faint voice.

“Please, Sir,” replied Oliver, “I want some more”.

Charles Dickens Oliver Twist Chapter 2

“You had a good trade, you made a good living, you thought the world a harmless place where you could take your pleasure as you willed. You never armed yourself with your true friends. After all, the police guarded you, there were courts of law, you and yours could come to no harm. You did not need Don Corleone. Very well. My feelings were wounded but I am not the sort of person who thrusts his friendship on those who do not value it – on those who think me of little account…..

“Now you come to me and say, ‘Don Corleone give me justice.’ And you do not ask with respect. You do not offer me your friendship….

“Good, you shall have your justice. Some day, and that day may never come, I will call upon you to do me a service in return.”

Mario Puzo The Godfather Book 1

The Public Interest Journalism Fund (PIJF) could not continue. It was clearly unaffordable. Yet Mr Willie Jackson — the minister in charge of media for the Ardern Hipkins Government — foisted upon the public the Fair Digital News Bargaining Bill and left it, like a ticking time bomb, whilst the country went to the polls.

In light of the previous pronouncements by the National Opposition it was thought that the Bill would be consigned to the scrapheap. But no. The then-minister in charge of media matters, Melissa Lee, referred it to a Select Committee although this action seemed to be a matter of form rather than substance and the expectation was that this would be a formality prior to deciding not to continue with the Bill.

Indeed the Select Committee recommended that the Bill go no further but in an interesting example of a political equivalent of a “dollar each way” the Select Committee recommended some changes to the Bill.

Mr Paul Goldsmith who by this time had replaced Ms Lee kept his options open although the general sense emerging was that the Bill would not be rejected.

Indeed on 2 July Mr Goldsmith announced that the Government would progress the Fair Digital News Bargaining Bill through Parliament — it has the support of the National and NZ First parties, but not Act.

If it is to be enacted in whatever form it is going to need the support of Labour as well, perhaps, as the Greens and Te Pati Maori. Mr Jackson, who foisted the Bill on the country in the first place commented:

“I am relieved the Government is seeing sense and progressing with legislation to make the media landscape fairer for news companies operating online. We will take the time to look at the Government’s amendments, but support the intent of the bill.”

Of course they would. It was their Bill to begin with.

It appears that the Bill is going to require some amendments and the proposals that the Select Committee made about addressing some of the problems raised by Artificial Intelligence will not be taken up. I address those proposals — which now will not be proceeding — in an article to be published on 24 July.

The rationale for proceeding with the Bill is to ensure that there is a robust media landscape so that the media would be an effective fourth estate in democracy. In essence the Bill will require the major digital platforms like Facebook and Google to pay for the news content that they use.

The problem is that similar legislation overseas has proven to be ineffective. A simple expedient that can be adopted by the digital platforms would be to disengage from the dissemination of news content altogether.

In some respects Mainstream Media (MSM) having benefited from the PIJF for so long was like Oliver Twist at the Select Committee hearings. They wanted more — not gruel as was the case with Oliver but dollars to support their failing business models.

The problem is that there has been a declining trust in MSM and much of that had to do with the distribution of funds from the PIJF. There was a clear intention to keep the government distant from the distribution of the PIJF largesse, but public money it was nevertheless and the optics were terrible.

The Fair Digital proposals put even more distance between the State as the source of media funding and MSM itself. But what is proposed is a mechanism developed by the State using the coercive powers of the State by means of the legislative process, a compelled bargaining system, a State-based administrator, ministerial identification of platforms which would be subject to the regime and a network of penalties and sanctions for non-compliance. Once this State-designed mechanism is in place, MSM lines up like Oliver to collect the cash. And it is all as a result of the mechanism provided by the Government. 

Mr Goldsmith stated:

“The key change is adopting a ministerial designation framework. This will enable the minister to decide which digital platforms are captured by the Bill, allowing the Government to manage unintended consequences. We’ll also ensure an appropriate independent regulator is appointed as the Bill’s authority.”

Not surprisingly the News Publishers Association welcomed the fact that the Bill would proceed. It observed that the Bill had the overwhelming support of New Zealand’s media companies. That too is not surprising especially given that there will be financial rewards at the end of the track.

I have been a critic of the Fair Digital News Bargaining Bill and have written on it in earlier articles on this Substack. I believe that there is another solution to the problem and one that is far more principled than a compelled “bargaining” regime.

Shayne Currie in the New Zealand Herald for 3 July 2024 suggests that critics of the news Bill miss a key point. David Farrar is quoted in that article as saying of the Bill:

“It is unprincipled because it is forcing successful companies in one industry (social networks and search engines) to fund failing companies in another industry (media). The only rationale for this is that Google and Meta have money and Stuff doesn’t. Will we see Netflix levied money to fund home video rental stores? Will we see Foodstuffs levied money to fund Whitcoulls?”

Mr Currie then observes:

“Farrar conveniently misses the point that one reason companies like Google and Meta are successful is their reliance on news content from media companies to help drive their content machines, advertising revenue and business models.

“Nothing comes for free – NZME has to pay fees, for instance, to play music on its radio stations – and this law simply ensures the digital tech giants pay a fair fee for the content on their social and search engine platforms.”

Mr Currie actually provides the solution although he is too blinkered to see it. The complaint is that Meta and Google are “free-riding” on content produced by news media. Mr Currie points out that NZME has to pay fees to play music on its radio stations. That fee paying structure derives from copyright. That is where the solution to MSM complaints lies and Mr Currie has unwittingly identified it.

Clearly the “free-riding” by Meta or Google has copyright implications and the copyright licensing provisions of the Copyright Act 1993 could be amended to provide a licensing regime for the use by the platforms of MSM content. There would be no need for a Fair Digital News Bargaining Bill and the unfortunate optics of indirect State assistance to help out struggling MSM would not be present.

On the matter of optics, unlike the PIJF, at the moment there is no proposal to “tag” funding derived from the operation of the Bill in the way that there were conditions attached to PIJF funding.

But the proposals and what may happen provide an eerie similarity to the exchange from ‘The Godfather’. The news media are no friends of the State, nor should they be as Andrew Neil said to the House of Lords Committee and which I discussed here.

Yet here is MSM saying to the State: “You have got to help us. The platforms are taking away our livelihood. We want a just outcome. Just enact the Bill”.

All I can say is be careful what you wish for. It may well be that “Some day, and that day may never come, [the State] will call upon [MSM] to do a service in return”.

Just like the PIJF. Just like the Godfather.

This article was originally published on David’s Substack, A Halfling's View on 2 July 2024. Subscribe to David’s Substack to read more.