Publishers have more political power than they think

From the FIPP World Media Congress in Madrid, Ricky Sutton puts Australia's former Communications Minister Paul Fletcher on stage to lay out the one playbook that actually extracted money from the platforms. Fletcher, one of four architects of the News Media Bargaining Code alongside then-PM Scott Morrison, Treasurer Josh Frydenberg and competition regulator Rod Sims, walked through how Australia stared down Google and Meta: Google threatened to pull Search from a market where it held 95% share, Meta blocked news and accidentally shut down the Facebook pages of a health service and a rape crisis service mid-pandemic. The code produced 23 Google deals and 13 Meta deals worth more than AU$200 million a year (about AU$130 million from Google, AU$70 million from Meta), against Google's US$400 billion and Meta's US$201 billion in revenue, "about two-hundredths of one per cent". Fletcher's line to the room: "You have a lot of leverage with governments and politicians... it's still very meaningful and material from the point of view of any politician." The current Labor government has since replaced the code with a News Bargaining Incentive, a 2.75% tax on digital ad revenue for Google, Facebook, Microsoft (LinkedIn) and TikTok, offset by commercial deals, and Fletcher's warning is stark: "No deals have been done to date."

The crux

The lever that makes platforms pay is political power applied through competition law, not copyright or goodwill, and the window is now because AI has revived the existential threat to news revenue at the exact moment most governments are doing nothing.

Sell-side read

Arm your competition regulator with granular data: Fletcher's advice is to show "what this means for advertising markets, what it means for news margins, and compare it with the margins being earned by the platforms globally", because the tax-for-deals model only triggers when a regulator has the evidence to designate.

Watch

Whether any commercial deal is struck under Australia's News Bargaining Incentive before the 2.75% levy bites, which would tell us if the tax works or the platforms find the backdoor Fletcher fears.