In this photo illustration, the Facebook and Google logos are seen on a smartphone in front of an Australian flag.
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Australian Treasurer Josh Frydenberg said CNBC’s Facebook talks on the country’s new media law were “quite long and difficult” – but both sides eventually managed to resolve their differences.
The Australian Parliament last week passed a law requiring companies such as Facebook and Google to pay the media and publishers to associate their content with news feeds or search results.
Prior to the law, Facebook – in retaliation against the proposed bill – blocked Australian users from viewing and sharing news content on its platform. The Australian government has criticized the move, which Facebook later canceled after both sides reached an agreement.
“Well, there have been provocative negotiations,” Frydenberg told Will Koulouris of CNBC on Wednesday.
“Obviously, with Facebook, we were deeply disappointed by their actions to delete the Australian news from their website … But from that moment on, we got on the phone, we worked through our differences and I think we got to a mutually agreeable position, “he said.
Things are moving in the right direction, although this has been a rather long and difficult set of negotiations.
Josh Frydenberg
Australian Treasurer
Negotiations have resulted in the Australian government introducing last-minute changes to the proposed law – officially known as the News Media and Digital Platforms Obligation Bargaining Code – before it is passed.
“Facebook is now entering into good faith negotiations with Australian media companies,” Frydenberg said. He quoted the letter of intent signed by Seven West Media, which owns the Seven broadcast network, to provide Facebook news content.
“Things are going in the right direction, although this has been a rather long and difficult set of negotiations,” said the Treasurer.
Facebook’s response to the media code has often been compared to Google’s reaction.
Google has also withdrawn heavily and threatened to withdraw its search function from the country – but the company eventually ceded and entered into transactions with several media outlets, including Seven West Media and the Murdoch family owned by News Corp.
Frydenberg said there was “no doubt” that other countries were following developments in Australia’s new media law.
The enactment of the law has made Australia the first country in which a government-appointed arbitrator can decide on the final price digital platforms must pay to news publishers, provided that a commercial agreement cannot be reached independently.
Countries like France have taken some steps to get tech companies to pay for the news, while others like Canada and the UK are thinking about the next steps.
– Saheli Roy Choudhury of CNBC contributed to this report.