(Writes through, adds Frydenberg quotes, additional Sevenquotes)
By Byron Kaye
SYDNEY, Feb 15 (Reuters) – Australia’s Seven West Media Ltdbecame the country’s first major news outlet to strikea licensing deal with Google, as the government pushes aheadwith a law that would force the internet giant to pay mediacompanies for content.
At an earnings announcement on Tuesday, Seven, which owns afree-to-air television network and the main metro newspaper inthe city of Perth, said it would supply content for Google’sNews Showcase platform. It did not disclose terms.
The deal shows Seven splitting from rivals News Corpand Nine Entertainment Co Holdings Ltd whichhave failed to reach agreements with Google and instead backedlaws, set to be passed this week, where the government sets theonline giant’s content fees in the absence of a private deal.
So far in Australia, only specialist online publishers andone regional newspaper have struck deals to receive payment fortheir content appearing on the new Google platform which wentlive in the country this month. Outside Australia, Reuters isamong news outlets with similar Google deals.
“The negotiations with Google recognise the value of qualityand original journalism throughout the country and, inparticular, in regional areas,” said Seven West Chairman KerryStokes in a statement.
Google’s Australia CEO Mel Silva said the U.S. company was”proud to support original, trusted, and quality journalism” byfeaturing Seven on its platform.
Last month, Silva told a parliamentary hearing Google wouldpull its search engine from Australia if the so-called NewsMedia Bargaining Code became law. A Google representativedeclined to comment on the effect of the Seven deal.
Hours before Seven revealed its plans, Treasurer JoshFrydenberg told the Australian Broadcasting Corp he stillplanned to introduce the laws, but added: “I think we’re veryclose to some significant commercial deals and, in doing so,that will the transform the domestic media landscape”.
The way the law is worded, the government only imposes anegotiator to set fees if the media company and Google can’tcome to an arrangement privately.
A Seven spokesman told Reuters the company still supportedthe law.
A Nine spokeswoman declined comment, while a News Corprepresentative in Australia was not immediately available forcomment.
“The signs are that the Australian government and Google areclose to a compromise,” said Paul Budde, an independent mediaand telecommunications industry analyst.
“This allows the government to claim victory, while thedamage to Google will be limited. Publishers will in one way oranother be paid for news.”
Seven separately reported a 26.5% jump in underlying profitfor the six months to end-December, helped by strong performancein its advertising market.
Seven shares jumped as much as 10.6% to their highest levelsince May 31, 2019 in early trade, while the broader marketwas up 0.9%.
($1 = 1.2887 Australian dollars)(Reporting by Byron Kaye in Sydney and Shriya Ramakrishnan inBengaluru; Editing by Diane Craft and Richard Pullin)
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