SYDNEY, Aug 12 (Reuters) - Australia will raise the number

of deals large tech firms must strike with local news outlets

under a revamp of its media licensing laws to be introduced to

parliament on Thursday, the government said, adding the measure

would distribute advertising revenue to more domestic outlets.

The changes also commit the government to giving 5% of funds

raised under the scheme to the Australian Associated Press

(AAP), the formerly industry-owned newswire service, which now

runs as a non-profit.

Changes made after discussions between government and

opposition would also require digital platforms to strike deals

with at least eight media companies, up from six in an earlier

draft.

The government also reinstated a cap limiting any single

deal to 25% of a platform's levy liability under the law, which

is equal to 2.5% of a company's Australian advertising revenue,

with the amount they pay offset by the value of deals they

strike.

The legislation revives Canberra's effort to channel money

from large technology companies to Australian news organisations

whose content helps drive user engagement and advertising

revenue on their platforms.

"People access news in different ways and from different

sources, which is why we made changes to the distribution scheme

to better support smaller and diverse media organisations," said

Communications Minister Anika Wells in a statement.

The funding for AAP, which supplies text, photographs and

video to media organisations around the country, and which faced

closure in 2020, recognises its role supporting public-interest

journalism, the government said.

Australia's original 2021 media bargaining law required

Google and Facebook owner Meta to negotiate

payment deals for news content, with a government-appointed

arbitrator empowered to set terms if negotiations failed.

The tech giants struck a series of commercial agreements

under that framework, but the government began redesigning the

regime after Meta said it would stop paying for news content in

Australia and other markets.

The new plan includes platforms such as TikTok and

Microsoft's ( MSFT ) LinkedIn.