Interview with Melissa Clarke, AM, ABC Radio National

Subject: News Bargaining Incentive Melissa Clarke: Assistant Treasurer Daniel Mulino joined me in our Parliament House studio a short time ago. Daniel Mulino, thanks for speaking to AM this morning. Daniel Mulino: Oh, thanks for having me on.

Now, after some consultations, you’ve made some adjustments to this plan, including the tax rate and how it’s calculated. Can you explain the changes that you’ve made for me? Yeah.

This is a really important reform that reflects the importance of public interest journalism for our democracy. And big tech companies, if they’re using news, should provide some compensation to the producers of that news. And that will mean that we have a news production ecosystem that is more sustainable going forward.

So, the first change is to say that the charge‑base for the News Bargaining Incentive will be advertising revenue, rather than the entire revenue of the digital company. And that reflects the fact that what we’re really trying to target here is the part of the business which uses the news. So, we’ve upped the charge rate from 2.25 to 2.5 per cent to make sure that the overall amount of money raised by the deals entered into by these platforms with the media is about the same, and that it will, going forward, increase as the amount of revenue from advertising increases for the platforms, but that this will be more connected with that part of their business.

So you’re not taxing revenue that might be connected to other things they might sell, like software or mobile phone handsets? Exactly, because we don’t want to discourage those large tech companies from having a growing footprint in Australia. What we do want, though, is that part of their business which is using news, to be fairly compensating the producers of that news.

And what about AI services? Because it seems they, too, are looking at work produced by journalism and repurposing it as their own output. Will this news bargaining initiative address AI?

So, we’ve made the decision to continue to exclude AI from this decision, and that makes sense, given that the government is leaning in on AI more broadly. The Prime Minister’s speech, delivered a week and a half ago, made very clear that he was going to implement a series of processes to look at things like copyright to make sure that creative producers are protected, so that has its own separate process and it’s appropriate that it’s separate from the NBI.

You’ll put forward legislation that means these social media companies need to strike deals with more media companies in order to be able to offset against the tax that would otherwise be raised. The question is, though, how confident are you that these companies will play ball? We’ve seen them walk away from previous arrangements and prompt a remaking of it.

Could they just do that again? Well, and this is the design of the NBI, which is that if they walk away which is what they did under the previous arrangements, but under the NBI, if they walk away, they will actually end up paying more. So, there’s a 50 per cent higher rate that they will pay overall if they just decide to walk away.

Could they walk away from the market altogether and just not allow any news to be published on their platforms? I’m confident they won’t do that because Australia is one of the larger economies in the world. It’s a very profitable economy for them.

We’re hearing no indications that that would be their reaction. The likelihood is that they would end up, if they decided not to enter into any deals, they would pay the higher amount, which would end up, of course, being distributed to media based on journalist numbers, based on the mechanism Anika Wells is proposing. Daniel Mulino, thank you very much for the update.

Thanks very much. And Daniel Mulino is the assistant Treasurer.