Google will pay Nine $30 million dollars annually for the use of its news content, the publisher’s mastheads reported today.

The deal comes as legislation for the government’s arbitration process between tech giants and Australian publishers in the absence of such deals is being debated in parliament.

On Wednesday the Nine Entertainment owned Sydney Morning Herald cited industry sources to report the publisher had signed a letter of intent with Google for a deal worth more than $30 million in cash annually for five years.

A final agreement could come before the end of the month and follows a similar announcement from Seven West Media to sign on to the search giants own model for paying publishers, News Showcase.

News Showcase is a licencing program where Google pays news publishers to curate their content to be used across Google’s services. Publishers negotiate individual deals with Google – which says it has budgeted $3.3 billion globally for Showcase but declined to say how much it expects to go to Australian publishers.

Google had threatened to “pause” the rollout of Showcase in response to the looming News Media Bargaining Code, the Australian government’s bargaining mechanism that includes forced “best offer” arbitration when deals can’t be struck.

But after pressure from senators to show its alternative, Google launched Showcase in Australia earlier this month with several smaller publishers involved.

Legislation for the News Media Bargaining Code will be debated this week in parliament but already has principal support from the opposition. The mere threat of the code has already accelerated negotiations between tech giants and publishers which last year remained far apart on revenue-sharing deals.

And while deals are being made outside the code, publishers still want the laws passed to ensure Facebook and Google will have to pay them for using news content in their products in the future and potentially provide advanced notice of changes to ranking algorithms.

Nine’s backflip

Nine’s apparent deal – it is yet to be formally confirmed by the company – means Australia’s largest locally owned media company is on board with the Google model it had only recently dismissed.

“This is what monopolies do, they put an offer, in the form of Google Showcase, but not offer to negotiate,” a Nine spokesperson said a fortnight ago.

“It has to be all on their terms and that is not an approach we will participate in. We support the legislation the government is proposing as the best way to secure a fair payment for our content.”

Today, Nine’s papers reported the Showcase deal is for five years for news articles across a variety of Google products but does not include Nine content on YouTube.

The deals that Google will strike with companies Australian publishers like Nine and Seven are not expected to include the use of news content in Google’s search results, however.

But organisations “have been willing to accept them in principle because the amount of money on the table is worth the same, or a similar amount, to what a company would have received for appearance of content in Google search”, according to the Sydney Morning Herald report.

Guardian Australia and News Corp – the two other major publishers lobbying for the code – are believed to still be negotiating deals with Google. News Corp is working on a global deal to cover content from its numerous publications around the world.

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