• Proposed legislation will force Google news feeds to pay for news.
• Tech giant threatens to pull all links to NZ news.
• Journalists and media organisations demand recompense.

The New Zealand government has announced it intends to continue progressing the Fair Digital News Bargaining Bill (FDNGB). The FDNGB is designed to force online news portals, such as Google Search, to pay local news organisations for the stories and content that they use.

In response, Google has said it will stop linking to all NZ news sites and scrap any existing deals it has with news outlets in the country, if the bill comes into force. The FDNGB was proposed by the previous New Zealand administration and was thought by commentators to be dead and buried. But in a surprise move, the country’s new centre-right led coalition has breathed new life into the proposals. Although it’s thought that the ruling coalition would likely not pass the bill into law on its own, there is enough cross-party support for FDNGB to come into force.

New Zealand’s Minister for Media and Communications, Paul Goldsmith, said he was considering a range of views from across the media sector. “We are still in the consultation phase and will make announcements in due course,” he said.

Google’s New Zealand country director, Caroline Rainsford, said in a blog post, “We’d be forced to stop linking to news content on Google Search, Google News or Discover surfaces in New Zealand.” Google’s concerns are rooted in what it sees as potentially uncapped expenditure if it has to pay for what it publishes inside its various apps and portals. At present, outside of any existing agreements the company has with NZ press businesses, its expenditure is firmly capped at $0.00 (apart from the cost of operating its algorithmic global web scrapers, of course).

Hard times in the press box

Traditional media organisations and, in particular, news outlets are experiencing hard times. Since the internet’s mainstream arrival in the 1990s, companies whose life-blood was the dissemination of information in return for money have struggled to come to terms with the internet. That’s led to several different strategies being followed by media companies, including the erection of paywalls, membership schemes, online and on-page advertising, and subscription tiers, with varying degrees of success.

The dire situation for ‘traditional’ publishing has worsened considerably in the last 12 months, thanks to proprietors of often-ancient news institutions laying off thousands of journalists because AI can allegedly do journalists’ jobs better.

Despite the dichotomy of the internet’s free information exchange and the need to pay business costs, many news web sites still publish their articles and media free for public consumption to some degree. In fact, one of the areas of media that may well survive the next 20 years relatively unscathed is the local press – either highly regional or national publications – that publish items of local interest, drawing from the specialist knowledge of human content creators and writers.

Because of dominant market position held by big technology providers, the de facto choice for news and media consumption becomes the portal or app, rather than consumers manually clicking around the sites and feeds that they may be interested in. During what might be termed ‘manual browsing’, users will perhaps consider signing up for a subscription to a local or national news site, will probably read and absorb advertising material that’s a source of income for the outlet, and explore their own content rabbit holes.

Google news gathering

The attraction of operating portals by companies like Google, Apple, and MSN is to provide a ‘free’ service to consumers to more accurately track readers’ preferences and behaviour, information that can be used internally by the portal operator for better targeted advertising, or sold to any organisation that has the money to pay for it.

Monies thus harvested are not subject to tax in New Zealand, offering Kiwis the double whammy of a dying domestic news industry and no extra tax dollars. Google’s threat not to link to any New Zealand news media could in some ways be regarded as a positive move.

According to Reuters, “Australia introduced a law in 2021 that gave the government power to make internet companies negotiate content supply deals with media outlets. A review released by the Australian government in 2022 found it largely worked.”

A similar success story can be found in Canada’s Online News Act, which compels technology companies to agree with news publishers a price for use of content. In Canada’s case, the total payment is around CAN$100m pa, the first instalment of which is due to be distributed in the next few weeks.