Nine Entertainment (ASX: NEC, Nine) has signed agreements with Facebook and Google, following the Commonwealth Government’s enacting of the News Media Bargaining Code. The move ensures that Nine will be paid for content running on Facebook and Google’s platforms.
The deal with Facebook is for the supply of news video clips and access to digital news articles on Facebook news products, for a term of up to 3 years with a minimum amount payable over the term.
The 5-year agreement with Google includes the supply of news content (excluding video) for Google’s News Showcase and other news products. Google will also expand its marketing initiatives across Nine’s platforms. The amount payable is a fixed annual fee with Nine expecting modest growth in the early years.
While the total amount of the deals is being kept in commercial-in-confidence, Nine expects growth of publishing earnings before interest, tax, depreciation and amortisation this financial year to be between $30 to $40 million.
In an email sent to staff, Nine chief executive Mike Sneesby said that “Our FY22 budget planning cycle is well underway, part of which is focussed on developing investment opportunities that will enable us to continue to grow and serve our audiences. These deals consolidate our position in an increasingly competitive market, but we will need to remain creative and open to opportunities to improve what we do and how we do it.”
The Australian Senate Economics Legislation Committee officially presented its report into the Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2020, more commonly referred to as the Media Code laws, in February this year.
The bill aims to correct the imbalance of power between big tech companies and news organisations.
The deal comes after Seven West Media, News Corp, and Junkee Media have all announced their own agreements in recent months.