Microsoft's Brad Smith lays out why the company is taking news publishers' side in the fight with big tech

  • An Australia law requiring tech companies to pay publishers led Facebook to ban news on the platform.
  • Microsoft’s president Brad Smith said he hoped other countries adopt similar measures.
  • Microsoft is also working with European publishers on an “Australian-style arbitration mechanism.”
  • Visit the Business section of Insider for more stories.

Microsoft President Brad Smith said that he hopes the US and Europe take a similar approach to Australia’s move to require tech companies to pay news publishers.

Facebook last week banned users in Australia from sharing, interacting or viewing links to news articles after the country passed a law requiring companies like Facebook and Google to pay news publishers for content that is shared on their platforms. Google also initially protested the law but eventually made deals top pay news publishers like News Corp. Australian Prime Minister Scott Morrison said on Saturday that Facebook was back to negotiating with Australia.

Smith has been vocal about supporting the Australian government and critical of Facebook and Google’s handling of the stand-off. He said he wants the US to make similar moves to Australia’s.

“I’m hopeful that the Biden administration will support and embrace this kind of policy to redress the imbalance between something like a search service by Google and the position of the news publishers,” he told Insider’s Nicholas Carlson on Thursday.

“There’s some important legislation in Congress that will enable publishers to join together and bargain collectively and give them anti-trust immunity to do so,” he said. “That’s part of the Australian proposal that I think is innovative and deserves attention.”

He said the need to hold Facebook and Google accountable for misinformation was recently reflected in the January 6 riot on the US Capitol.

“You cannot have a well-informed public without a healthy, independent base of professional journalism, so think all of these things are coming together in 2021 and they should,” he said.

Microsoft is working with European news publishers to set up an “Australian-style arbitration mechanism” requiring tech companies to pay publishers. European news publishers also lobbied the European Union last week to use parts of the law that would require tech companies to pay news publishers.

Smith said that Microsoft News has shared more than $1 billion with US publishers through a revenue-share program. He cited Apple News and news initiatives from Facebook and Google as “good” examples of how tech companies pay publishers, but said governments need to be involved, too.

“You need to look at the economic value that in effect is being transferred, I believe, from the news industry to the tech gatekeepers simply by virtue of being able to include and make use of their news content on a search service or on a social media platform — this is where I think that we need the intervention of government,” he said.

Smith said there’s a need for independent journalism and that Australia’s law defines independent journalism as an enterprise that doesn’t act on behalf of groups like government or advocacy organizations.

“There are going to be many different ways and needs for us to support journalism —  it’s not just a panacea that comes from one innovation and change between tech platforms and journalism,” he said. “But I do believe that this change that we’re seeing from Australia is relevant to the world and will make the world’s democracies healthier.”

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