Media bosses urge MPs to 'level playing field' with big tech

Media bosses sounded a warning in Parliament today about journalism in jeopardy and the potential damage to democracy if the government does not back a Bill making offshore tech giants pay for their news.

Executives from New Zealand’s major media companies appeared before a select committee on Thursday to submit on the Fair Digital News Bargaining Bill, which would create a binding arbitration process if offshore digital platforms and local news media companies do not agree on deals for news content. 

They delivered a consistent message: the current digital advertising market is broken and their companies may not survive if it is not fixed. 

Meta (the owner of Facebook) and Google have come to dominate the digital advertising market over the past 20 years and at the expense of that mainstream media advertising revenue has declined.

RNZ chief executive Paul Thompson said media companies did not have a "level playing field" with tech giants like Meta and Google. 

He said several could close in the foreseeable future and the resulting vacuum could be filled by misinformation and disinformation from offshore.

"If we don't tell and own our stories, if New Zealanders don't have a range of media to come to ... they will get the information from somewhere else and it will break our democracy," Thompson said.

That message was echoed by Jana Rangooni, chief executive of the umbrella group representing the commercial radio industry - the Radio Broadcasters Association. 

"It's like asking the All Blacks to compete at a Rugby World Cup in New Zealand in bare feet. There's no way this legislation is aimed at helping New Zealand media companies; it's about trying to correct a huge imbalance."

News Publishers Association (NPA) public affairs director Andrew Holden said Meta and Google had taken news content created and paid for by others and leveraged it into an unassailable market share.

In 2022, the NPA secured Commerce Commission approval to negotiate collectively with Google and Meta in order to ensure large and small publishers of news could benefit from a deal for payment.

Holden pointed to this week's coverage of the anniversary of Cyclone Gabrielle as an example of what we could lose without new media revenue streams.

"Put simply, the market is broken. Just like the homes, properties and businesses in Tai Rāwhiti, it needs to be fixed."

Concerns about over-reach

Some submitters to Parliament's Economic Development Science and Innovation committee opposed the Bill on the grounds that tech giants should not be compelled to bargain or punished for innovating. 

NZ Taxpayers Union policy and public affairs manager James Ross quoted National Broadcasting Minister Melissa Lee, who several months ago described the bill as a "shakedown". 

"In this case, we happen to agree with her."

Retired judge David Harvey told the Committee the Bill disincentivised the media from adapting to the digital age.

He noted the movie and music industries had reformed their operations to work through online streaming platforms. 

"Though not without some pain I would concede," he said.

Harvey - a former chair of the Copyright Tribunal - argued existing copyright law was sufficient to deal with the media’s concerns about its content being used without permission.

Allied Press chief executive Grant McKenzie said the idea tech giants could be brought to heel by existing laws and processes was fanciful.

"Has anyone tried to get in touch with Facebook to remove something? I encourage you to try because they don't."

TVNZ executive editor Phil O'Sullivan said Google "scraped" local news content for search results with impunity. Local media organisations received no financial benefit for that, despite paying to produce the content, he said. 

Stuff chief executive Sinead Boucher said the tech companies were "modern day succubites", taking others' content and growing stronger and fatter off work which was not their own, then arguing when challenged that it was just "fair use of the open web".

She said 93 percent of people searching for Stuff content on Google now remain on Google's products, and only 6.5 percent click through to the website.

"What is fair about one company creating all of the content but another company extracting all of the value?"

If politicians did not act, the future for local media could be dire, said Boucher, who is also the current chair of the NPA.

She said she had spoken to several media executives who said their companies were "clinging on by their fingertips" and proprietary innovations in AI could make it worse.   

"This is looking increasingly like an extinction-level event."

Google and Facebook's owner Meta did not appear before the committee. But both have argued in submissions the Fair Digital News Bargaining Bill is unfair and misunderstands how their platforms work and the true value of locally-produced news.

The Bill was introduced by the former Labour government. 

The current government's media minister, Melissa Lee, has previously said she did not support the Bill but after the election, she did allow it to go to the Select Committee to be debated.  

An alternative proposal

Several submitters said the bill could be improved if it was replaced by a levy on tech giants' digital advertising revenue, which could be distributed back to publishers by an outside agency.

Better Public Media trust chair Dr Peter Thompson said tech companies were having negative effects on wider society – not just the media – through their mass harvesting of personal information and the way they had allowed the proliferation of disinformation and hate speech.

A levy would ensure they would be forced to compensate for those effects, he said.

However, he understood why media organisations might like to settle for the current Bill.

"If you're drowning, a straw might seem like an attractive thing to clutch at. We'd just rather send a lifeboat."

James Frankham, the owner of Kowhai Media which publishes NZ Geographic, agreed a levy might be more fair for smaller publishers. 

He said companies like his had less leverage than larger organisations in direct bargaining. 

"It feels like we've had tech giants holding our heads underwater for the last 10 years."