WASHINGTON — The social network giant refuses to bend to regulatory intervention that seeks revenue share with media outlets for sharing news content in Australia and elsewhere.
Australia, poised to adopt a legislation that would force digital platforms to pay for news content, prompted Facebook’s decision to restrict Australian news to be viewed, read or shared on its site, not only in Australia but also in other parts of the globe.
Unlike Google, which has been brokering with media groups in response to regulatory intervention, including one with Rupert Murdoch’s News Corp., Facebook would not bend.
Facebook misunderstood, Australia news content won’t be shared
“The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content,” says William Easton, Facebook’s manager for Australia and New Zealand.
“It has left us facing a stark choice: attempt to comply with a law that ignores the realities of this relationship, or stop allowing news content on our services in Australia. With a heavy heart, we are choosing the latter,” he says.
Although there had been earlier reports that, according to Australian officials, the two US tech giants were close to deals with major Australian media to pay for news to resolve a standoff being closely watched around the world, talks did not reach an expected resolve.
Threats of withdrawing services from the country had been exchanged should the rules become law, which further sparked word wars with Canberra. In the end, the rules had materialized.
“Value exchange is in favor of publishers”
Easton said Facebook has argued to Australian officials that “the value exchange between Facebook and publishers runs in favor of the publishers,” and generates hundreds of millions of dollars of revenue for the media organizations in the country.
“We’ve long worked toward rules that would encourage innovation and collaboration between digital platforms and news organizations,” Easton says.
“Unfortunately this legislation does not do that. Instead it seeks to penalize Facebook for content it didn’t take or ask for,” he says.
However, Australia’s competition watchdog maintains, “for every $100 spent on online advertising, Google captures $53, Facebook takes $28 and the rest is shared among others, depriving media outlets of needed revenue to support journalism. The situation is mirrored in other parts of the world where tech platforms are facing increasing pressure to share revenue with news media.”
Facebook’s news partnerships head Campbell Brown says in a tweet that the company acted reluctantly to block news content for Australian users. “Our goal was to find resolution that strengthened collaboration with publishers,” she says.
“But the legislation fails to recognize fundamental relationship between us & news organizations,” she tweets.
Google takes the road less traveled
Google, on the other hand, took the opposite tack, announcing a deal that would allow for “significant payments” to Rupert Murdoch’s News Corp. for content. A joint statement made for a “historic multiyear partnership” that would see news from the media giant included in the Google News Showcase.
It also covers content from the News Corp.-owned Wall Street Journal, Barron’s, MarketWatch and the New York Post in the United States; British-based The Times and The Sunday Times, and The Sun as well as a number of Australian media outlets, including The Australian.
News Corp., the last major private media yet to make a deal, was instrumental in pushing the Australian government to handle the tech giants.
Facebook says it had been reassured by recent discussions with the government:
“Going forward, the government has clarified we will retain the ability to decide if news appears on Facebook so that we won’t automatically be subject to forced negotiation,” says Campbell Brown.
“We have come to an agreement that will allow us to support the publishers we choose to, including small and local publishers.”
Facebook already has its own “showcase” product – Facebook News Tab – through which it pays media organisations a fee to display their stories on its platform. This feature however, is only available in the UK and US. (SA/Headline PH)