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Facebook has allowed the dispute with the Australian government to escalate: the social network announced on Wednesday that it would no longer allow the distribution of journalistic content on its platform in the country. This is a reaction to a planned law in the country that would force internet companies like Facebook and Google to share sales with media companies whose content they display on their platforms.
Christoph Hein
Business Correspondent for South Asia / Pacific based in Singapore.
As a result, Google has embarked on a confrontational course with the Australian government and has even threatened to shut down its search engine in the country entirely if the law goes into effect. However, unlike Facebook, the group has recently shown its willingness to cooperate. Just hours before Facebook’s announcement, he signed a deal with media conglomerate News Corp, which is part of the Rupert Murdoch family. known. This pact applies not only to Australia, but also worldwide, including for the group’s publications in other regions of the world, such as the American “Wall Street Journal” or the British “Times”. Google has also signed several agreements specifically for the Australian market.
Facebook said on Wednesday it made the decision in Australia “with great regret.” The group argued that the new law was based on “a fundamentally flawed understanding of the relationship between our platform and publishers.” This is also one reason why Facebook is choosing a different path than Google. The Google search engine is “inextricably linked” to the news, and publishers do not voluntarily provide their content. They do it on Facebook because it helps them sell more subscriptions. The bottom line is that publishers even benefit more from distributing their news on the social network than Facebook itself. News is only for four percent of all content in Facebook’s central “News Feed” bar. The planned law would now punish the company for content that it had not requested.
Impact around the world
The drastic move Facebook has now announced targets Australia, but it will be felt around the world. Users in Australia can no longer view or share any news on Facebook, and publishers there can no longer post any news here. Users from other regions can see news, but not from Australia. In turn, publishers around the world cannot distribute their content to the Australian audience.
In a further blow, the company announced that it would also change its plans for the introduction of the news portal “Facebook News” in Australia due to the proposed law and would instead “prioritize investments in other countries”. This service has been available in the United States for over a year and was recently launched in the United Kingdom. Facebook shows journalistic content on it and concludes deals with publishers, that is, it pays them.
The three-year deal between Google and News Corp. Meanwhile, a remarkable truce, News Corp. himself called it “historic.” Murdoch’s media empire has been one of Google’s harshest critics for several years. He accuses the internet giant of not paying publishers properly for the content and even asked for it to be disbanded some time ago. Financial details of the alliance were not disclosed, News Corp. talks about receiving “major payments” from Google as of now.
In Australia itself, Google has signed an agreement with the Nine media group, to which, for example, the “Australian Financial Review” belongs: the Americans pay them AU $ 30 million annually for a period of five years. The daily “Guardian” and the state broadcaster ABC should continue with agreements in the coming days, according to the industry. In May last year, Nine’s Chairman of the Board of Directors, former Federal Reserve Chairman Peter Costello, suggested that the search engine pay Australian media around A $ 600 million a year to use its content, about a tenth of its 2018 revenue. Manager Don Harrison said in a statement now that his company expects to establish more partnerships shortly.
