Australian Prime Minister Scoot Morrison plans to force legislation for Facebook to pay news outlets for content. This is after receiving support from world leaders after Facebook backed out all media.
On July 2017, Australian Competition and Consumer Commission (ACCC) expressed plans to investigate big tech companies such as Facebook and Google based on a voluntary code recommended in its Digital Platforms Inquiry. The inquiry wants to address power imbalances between major media and digital platforms. This went on to the extent that the Australian government would establish the world’s first policing of Facebook and Google in these reforms.
On April 2020, the government specifically asked ACCC to develop a mandatory code of conduct, which stipulates that companies, specifically Facebook and Google must pay Australian media outlets for news content.
In July 2020, the ACC released a draft code for public consultation and a series of questions and answers, asking the stakeholders of Australian news outlets about the draft code, as well as making its intent publicly known to digital companies. In September 2020, Facebook, vehemently against the code, stated that it would stop Australians sharing news content on its platforms were that proposal to become law.
After consultations and recommendations from Australian stakeholders nationally, the ACCC made recommendations to the Australian government based on the views of these stakeholders. To justify the imbalance of power that is occurring on a large playing field, the ACC’s report reads:
“Where Google’s and Facebook’s business users are also their competitors, there are questions about whether there is a level playing field, or whether they have the ability to give themselves advantages by favouring their own products. As Google and Facebook continue to expand into adjacent markets through acquisitions and organic expansion, these risks increase.”
The government considered these recommendations from ACCC and developed the final legislation.
In December 2020, amidst growing concern on Facebook and Google’s side (with Microsoft agreeing to the code), the News Media Bargaining Bill 2020 was introduced to Australian Parliament, specifically forcing major digital platforms to pay Australian media outlets for news content.
In February 2021, when this code cleared the house of representatives, but still needing senate approval to become law, Facebook blocked news feeds in Australia, including government and community sites, saying it could not work with the code. Hence, news headlines all over the world read: “Facebook unfriends Australia.”
What Is the News Media Bargaining Code?
Specifically, the News Media and Bargaining Code is a bill that seeks large technology platforms operating in Australia to subsidize local news publishers for the content either made available or linked on their platforms.
In order to qualify as a news publisher, the code defines that the organization must have an annual revenue of upwards from $150,000 within three of five most recent years. These means not all Australian publishers are subject to payments from these tech companies.
Just how much do they have to pay if Google and Facebook don’t agree?
According to the code, the penalty for not adhering is a maximum fine of $10 million per year or a portion of the company’s annual revenue. Which is huge, if you’re Facebook or Google.
Under the code, Facebook and Google would be required to share revenue for posted, shared, or linked content with Australian publishers. The law says that the price would be up to the bargaining between the Australian publisher and the tech giants.
The code also demands that Facebook and Google would have to:
“…provide registered news business corporations with advance notification of planned changes to an algorithm or internal practice that will have a significant effect on covered news content.”
For years, Facebook and Google have kept much of their internal workings about algorithms very, very secret. Now, Australia will be forcing them to share their trade secrets, in the process of alerting Australian news corporations about their plans.
What Does Facebook Think?
Well, Facebook doesn’t like it enough to block all news from Australia.
On February 17, 2021, Facebook VP of Global News Partnerships Campbell Brown issued a public statement as to why they’re restricting the availability of news in Australia. According to Brown:
“For the last three years, Facebook has worked closely with the Australian government on regulation that would help better define the relationships between technology companies and news organizations. Regulatory environments conducive to strong collaboration allow us to build innovative and sustainable ways to support journalism for the long term.
“What the proposed law introduced in Australia fails to recognize is the fundamental nature of the relationship between our platform and publishers. Contrary to what some have suggested, Facebook does not steal news content. Publishers choose to share their stories on Facebook. From finding new readers to getting new subscribers and driving revenue, news organizations wouldn’t use Facebook if it didn’t help their bottom lines.”
This move by Facebook puts pressure on Australian news outlets, which caused traffic to Australian news sites from out-of-country visitors to drop by 20%. Which, after all, means that Facebook still has leverage in this matter.
That seem clear to Prime Minister Morrison, saying “Let me be clear. Australia makes our rules for things you can do in Australia. That’s done in our parliament. It’s done by our government; we don’t respond to threats.”
What Happens Now?
After tensions cooled down, Facebook is now currently in talks with the Australian government to resolve this issue once and for all. However, this may take some time, as moves from both parties have had risks involved in the past, as this article shows, and more risks to come in the future.