The Australian government is witnessing their link tax crash and burn, so there’s a push to include other platforms.
When Australia finalized it’s link tax law back in 2021, it was based on he false premise that platforms are somehow unjustly enriching themselves by “using” the media’s content for their own financial gain. Based on this false premise, the link tax concept was born with the idea that platforms need to have a license in order to allow publishers to publish their links on their platforms so the publishers can derive a benefit of getting traffic flowing to their websites.
The concept is as backwards as it sounds. It’s essentially the same thing as ordering television broadcasters to pay advertisers a license fee for the privilege of airing their commercials. It’s a concept that makes no sense on television and a concept that equally makes no sense on platforms. Yet, thanks to a massive fire hose of lies from the media, several countries like Canada and the United States have either been pushing for or passing their own link tax laws.
Understandably, many have characterized the efforts to push for link tax laws as blatant rent seeking. The real deal here is that large media companies are wanting to get free money from the platforms so they don’t have to come up with innovative business models that attract new audiences to their product. They can carry on with business as usual without the worry of needing to change anything with their business model as the companies who are actually innovating are having to cough up the cash to prop up the traditional media companies dying business models.
It’s a trend that is only destined to get worse for traditional media. Traditional media have long been simply trying to court the Baby Boomer generation while actively shunning younger generations. This has been seen through a constant stream of “millennials have killed (insert anything here)” stories or a barrage of articles saying that gaming or the internet is going to turn you into a psychopath – two staples of the culture of younger generations. At the same time, actual problems faced by those same generations rarely, if ever, get any attention at all on top of it all. As a result, there is a constant alienation of younger generations by the traditional media.
As the large media companies vilify pretty much anyone who is younger than the boomer generation, countries are increasingly seeing those older generations dying out. In Canada, for instance, Statistics Canada reported that for the first time, millennials now outnumber baby boomers in Canada. A seismic shift that is yet another warning shot to traditional media outlets to either adapt or die out.
However, rather than focus on adapting business models to better serve the population, traditional media outlets are simply increasingly trying to get free handouts wherever possible. They have shown little interest in trying to be innovative and reinvent themselves because of this huge push. Link tax laws from around the world are a perfect illustration of traditional media outlets trying to simply get free money and rely less and less on actually attracting an audience to keep their business models afloat.
Of course, a demographic shift isn’t even the most immediate threat the large media companies bottom line. Meta, the corporation behind Facebook and Instagram, have been increasingly clear that they aren’t going to go along with the link tax scheme in recent years. Not only has the company started de-prioritizing news content, but has also, more recently, said that they aren’t renewing the deals that they struck. This was definitely in the case in Australia where they said that they won’t be renewing the deals and, instead, are going to simply delist news links altogether just like they did in Canada.
It’s a move that has, at the very least, me concluding that Meta has realized that there are better ways at protecting their market domination. After all, when Meta bizarrely went along with the Australian link tax law, the best theory at the time was that Meta was only doing so in an effort to solidify their market dominance. It is going to be much harder to start a social media company when the cost of entry is to the tune of, say, $200 million. However, as other countries started pushing for and passing their own link tax laws, that price tag has multiplied over the last few years. That cost is proving to be too much even for a company like Meta.
Knowing that Meta platforms depend so little on news links – even going so far as to plainly tell Canadian senators that news links are highly replaceable – the decision to drop news links became increasingly the obvious choice for Meta. Australian law makers who have been heavily lobbied by the media, threw a temper tantrum saying that Meta’s actions are a dereliction of duty even though it’s clearly not Meta’s job to be forking over free money to media companies for no real reason.
One of the long running, albeit, passive, fears about link taxes is that the link taxes would begin to be applied to other platforms as the media grows increasingly hungry for free money. Apparently, this is an idea being floated by lawmakers in Australia. From The Guardian:
TikTok, Apple News and Instagram should be included in deals under the news media bargaining code to reflect the change in where Australians are consuming their news online, the Greens say.
“More Australians now get their news on TikTok, YouTube, Apple News and Instagram than did back in 2021 and this should be reflected in the deals done under the code,” the Greens’ media and communications spokesperson, senator Sarah Hanson-Young, said.
The list of platforms that is being pushed to be included in the link tax is completely bizarre. Apple has long contended that 100% of all royalties are going to news publishers. They would likely be more than happy to tout how their services are bringing in quite a hefty chunk of change to these publishers. Yet, their name is being thrown around as a platform that should be paying into a link tax on top of it all. It’s, honestly, a real head scratcher.
Yet, Apple News is the least bizarre of the three being floated. TikTok and Youtube aren’t even platforms that are based on text or links in the first place. In order for video’s to appear, they have to be actively uploaded. If content is being uploaded without permission, a DMCA request can be filed or that content can be monetized through, say, ContentID on YouTube for the rightsholder.
The whole premise of the link tax is that news links are being shared on platforms and, therefore, a license fee should be paid for essentially citing a source. It’s a backwards idea, but that’s what the whole premise is in the first place. You go to a platform like YouTube or TikTok and you’ll quickly realize that because it’s video content, what is being asked isn’t even paying a license fee for links. Instead, it’s demanding a license fee for the privilege of allowing users to talk about the news. If you want an idea more absurd than a link tax law, how about a law demanding license fees for allowing users to simply talk about the news in the first place.
The situation is especially bizarre with TikTok because there has been a push for some time to ban the platform entirely. This is especially true in the United States where there has long been a fear mongering campaign that says that using TikTok will somehow get you brainwashed by the Chinese government. Yet, Australia is trying to have their media companies depend on handouts from that very platform. There’s no logic to any of this.
The best shot I see with this push is getting YouTube on board because Google has already been on board with the Australian model. TikTok is likely to balk at this and essentially say that Australia is ultimately closed for business before picking up their things and leaving (or finding a way to block news links instead). Either way, as you run through the list of platforms, you’ll see very quickly that there are going to be very few takers in this drive for free money. If Meta realizes how ridiculous it all is, what makes you think that the situation is going to be any different for other platforms.
Either way, this effort to look into including other platforms smacks of desperation to keep the free money gravy train flowing in Australia. They want an innovative online player to prop up legacy media companies. Outside of possibly suckering in Google a second time, it is difficult to imagine anyone else willing to go along with this.
Drew Wilson on Twitter: @icecube85 and Facebook.
