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Nine wants online giants to pay fair price

Steven Deare
·2-min read

Nine Entertainment chair Peter Costello has stepped up pressure for Facebook and Google to pay to use news reports and said its range of material would be unviable if it is not compensated.

Mr Costello told the media company's annual general meeting on Thursday that the market power of the two tech giants was one of the great challenges of the industry.

"They make very little Australian content and contribute very little to Australian employment," Mr Costello said.

"Nonetheless, they are able to use the premium content we produce to attract audiences in the Australian market."

A Google spokesman said the comments were incorrect.

He said Google invested about $1 billion in Australia last year, and had 1800 jobs in the country.

Google and Facebook have taken much of the advertising revenue of media operators such as Nine and News Corp, and embed or link to the latter's stories on their platforms.

Mr Costello said the digital giants were not paying for the material at a rate that fairly shared the cost of production.

If Nine was not fairly compensated, it would become uncommercial to produce all its programming, Mr Costello said.

However, the Google spokesman said the company did not use news stories, rather it linked to them as it did with every other page on the web.

He said Google search results each year sent billions of user queries to Australian news publishers.

This web traffic was worth $218 million in 2018, the spokesman said.

Media operators are hopeful of a mandatory code being devised to ensure Facebook and Google to pay for using news stories.

The Australian Competition and Consumer Commission introduced the draft code in July for feedback.

Mr Costello said the final detail would be important.

Facebook has also been contacted for comment.

Meanwhile, Nine Entertainment, which operates in TV, print, online and radio, said the advertising market had improved significantly in recent months.

The company expects 15 per cent revenue growth from metropolitan areas in its second quarter.

This is a marked improvement on the 15 per cent decline in its first quarter.

Nine said its share of the ad market had been helped during this period by major events including the NRL finals and State of Origin.

This meant metropolitan ad revenue for the half-year would be little changed on the previous six months.

Shares closed up 5.08 per cent to $2.48 on Thursday.