about 3 years ago • 3 mins
Australia passed a law on Thursday forcing Big Tech platforms to pay news companies to show their content. What a scoop!
What does this mean?
It’s been a long time in the making and much contested by Google and Facebook, but Australia finally has the exclusive on regulating payment for content. So while other countries like France have taken baby steps toward the same measures, Australia will be the first where – if private talks fail – a government middle-man can set the price domestic media gets paid.
Still, eleventh hour talks with Facebook did lead to some concessions. For starters, the tech giants are free to decide which media outlets to go after and how much they pay them. And if the Australian government thinks they’ve given the local news industry enough money, it never has to get involved. And even if the government decides they haven’t, they’ll have time to strike more deals before being forced into arbitration.
Why should I care?
Zooming out: This could be a watershed moment.
Australia’s regulation might usher in a new era, with Google and Facebook having promised to each pay publishers $1 billion over the next three years. That’s a big step up from the $600 million Facebook’s spent since 2018, and an even bigger one for Google, which previously only pledged to spend $300 million. Of course, it could’ve been worse for them if not for those last-minute amendments: the tech giants now have a lot more flexibility, which might be why both sides are claiming victory.
The bigger picture: The best laid regulations often go awry.
Global regulators’ legislative wishlist doesn’t end at payment for content: they’re keen to protect data, harvest taxes, and prevent anti-competitive tactics too. But that’s the irony: regulators might be acting in the best interests of the Average Joe, but the Average Joe could be the first to pay if the tech giants decide to pass the higher costs on…
Keep reading for our next story...
You might be tired of this work-from-home lifestyle, but Best Buy never wants it to end: the electronics retailer reported a better-than-expected profit and an uncertain post-pandemic outlook on Thursday.
What does this mean?
Folks have been kitting out their home offices and their, uh, kitchen table offices with screens, speakers, and laptops, and that’s been going well for Best Buy so far. But there are signs its luck is running out: the retailer’s revenue grew by a worse-than-expected 13% – a big drop from the 23% growth of the quarter before.
Best Buy isn’t sure how demand will look when economies reopen either, adding it to the list of retailers expecting shoppers to spend more on going out than staying in. So with the company keeping its sales outlook flat for the year, investors initially sent its shares down 8%.
Why should I care?
Zooming in: Retailers are never going to look quite the same.
Best Buy’s online sales represented 43% of its total sales last quarter – a significant bump from the 25% of the same time the year before. And since it reckons the shift toward ecommerce isn’t slowing down, it’s been rolling out some big changes: the company cut its workforce by 17% last year, and it’s testing a store design that’ll reduce the size of its sales floors so it has more space to fulfill online orders.
The bigger picture: Look for growth potential in your retail stocks.
You don’t need to tell Wayfair how important ecommerce is: the online furniture retailer benefited from the overlapping trends of online shopping and home improvement last quarter, posting a 54% surge in customers versus the year before. And while investors were worried this pandemic-driven boost would sputter out, Wayfair convinced them it still has plenty of opportunities for growth – from expanding its professional customer base to becoming a bigger player in appliances.
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