Facebook vs Australia: The big battle over news
The TLDR: Do tech companies like Google and Facebook help media publishers by freely distributing their news content to a wide audience? Or are they making free use of their content to mop up billions of dollars in advertising revenue? That’s the core issue at stake in the battle between Facebook and the government—which escalated when FB cut off all access to news for Australian users on its platform. Why this matters: Other governments are watching closely. And the outcome of this face-off could affect the future of news around the world.
Why is this happening?
The new law: On Wednesday night, the House of Representatives passed something called a media bargaining code. It requires Facebook and Google to negotiate with news publishers—either individually or collectively—to set a price for their content. And if the two sides do not come to an agreement over three months of talks, an independent arbitrator will pick one of the compensation plans—and the decision will be binding. Once the bill passes the Senate next week, it will become law.
Facebook’s response: The company—which has been fiercely criticising the bill for over a year—responded by blocking Australian users from sharing or viewing any kind of news content. Facebook’s blog post argued that it only allows news content on its platform as a public service:
“In fact, and as we have made clear to the Australian government for many months, the value exchange between Facebook and publishers runs in favor of the publishers—which is the reverse of what the legislation would require the arbitrator to assume. Last year Facebook generated approximately 5.1 billion free referrals to Australian publishers worth an estimated AU$407 million.
For Facebook, the business gain from news is minimal. News makes up less than 4% of the content people see in their News Feed. Journalism is important to a democratic society, which is why we build dedicated, free tools to support news organisations around the world in innovating their content for online audiences.”
So what happened then?
As always happens with tech companies, Facebook’s algorithm was a little over-zealous when it pulled the plug on Thursday morning:
“But by 9 a.m. in Sydney, the impact was apparent and even more wide-reaching than Facebook’s statements suggested. In addition to news publishers being blocked, pages for Fire and Rescue New South Wales, the Bureau of Meteorology and state police departments had all been wiped clean. Even state government pages with public health information about the pandemic were blocked, prompting outrage from many officials and lawmakers.”
The effect on news publishers was immediately apparent—as web traffic dropped by 13% overall, while the number of international readers fell by 30%.
Still unblocked: Prime Minister Scott Morrison’s angry Facebook post which suggested he may bring in outside help:
“Facebook's actions to unfriend Australia today, cutting off essential information services on health and emergency services, were as arrogant as they were disappointing. I am in regular contact with the leaders of other nations on these issues.”
Also available for viewing: all kinds of fake news, as Gizmodo notes:
“Pages like Australia’s biggest and longest running anti-vaxxer group (who Gizmodo has chosen not to name to limit the spread of their views), faux news sites that mostly post Infowars content, even Rebel News, the far right website that’s promoted conspiracy theories and who’s only Australian staff member has been banned from Facebook, are all unaffected.”
A perfect summary: of the state of affairs:
So Facebook might win this?
It depends on several factors.
One: How much will its users miss seeing news on their feeds? They may not care, and instead go directly to the few news sites they trust. That will be great for the big names but not for the many others who rely entirely on Facebook to access their audience. OTOH, it can also adversely impact how much time a person spends on FB. As one media expert told Wall Street Journal:
“Ms. Martin said she didn’t think Australians would immediately quit Facebook because the platform no longer includes news. But she said people’s use of Facebook could decrease over time, noting Facebook’s appeal has been that users could do multiple things on the platform, such as reading news, selling furniture or catching up with friends.”
Point to note: A recent Reuters report showed that Facebook remains the leading source of news for users in 12 major countries—and by a mile. In India, 52% of Facebook users get their news from the platform. That shows that news publishers are disproportionately dependent on Facebook for traffic. But it also shows that contrary to its claims, news consumption is a core part of the value offered by Facebook to its users.
Two: Erasing reputable news outlets with a flick of its hand is not a good look for a company already seen as wielding way too much power. A communications expert told Washington Post:
“Their decision to cut off news in Australia is a demonstration of their raw technical power and their willingness to use it for their own ends… It reminds me of Mr. Burns’s decision to block out the sun in the Simpsons movie —it stokes fear but also encourages resistance.”
Three: Facebook is also under great pressure to fix its toxic fake news problem—and it desperately needs reputable news sources to do so. In 2019, it unveiled a “news” tab on its US version—and has recently rolled it out in the UK. At the time, the company said:
“Facebook News was built to bring people closer to the stories that affect their lives. We’ll continue to learn, listen and improve News as it rolls out more broadly. We hope this work aids in our effort to sustain great journalism and strengthen democracy.”
Except this new tool requires a partnership with an array of leading news organizations—who it’s apparently willing to pay. Again, this is contrary to its claim in the blog post that described news as “content it didn’t take or ask for.”