On Wednesday Facebook published a response through managing director, Facebook Australia & New Zealand Will Easton about the code of conduct being pursued by the ACCC that would force it and Google to pay publishers for content, as well as provide data insights and advance warning of algorithm changes.
Below is the response:
Australia is drafting a new regulation that misunderstands the dynamics of the internet and will do damage to the very news organisations the government is trying to protect. When crafting this new legislation, the commission overseeing the process ignored important facts, most critically the relationship between the news media and social media and which one benefits most from the other.
Assuming this draft code becomes law, we will reluctantly stop allowing publishers and people in Australia from sharing local and international news on Facebook and Instagram. This is not our first choice – it is our last. But it is the only way to protect against an outcome that defies logic and will hurt, not help, the long-term vibrancy of Australia’s news and media sector.
We share the Australian Government’s goal of supporting struggling news organisations, particularly local newspapers, and have engaged extensively with the Australian Competition and Consumer Commission that has led the effort. But its solution is counterproductive to that goal. The proposed law is unprecedented in its reach and seeks to regulate every aspect of how tech companies do business with news publishers. Most perplexing, it would force Facebook to pay news organisations for content that the publishers voluntarily place on our platforms and at a price that ignores the financial value we bring publishers.
The ACCC presumes that Facebook benefits most in its relationship with publishers, when in fact the reverse is true. News represents a fraction of what people see in their News Feed and is not a significant source of revenue for us. Still, we recognize that news provides a vitally important role in society and democracy, which is why we offer free tools and training to help media companies reach an audience many times larger than they have previously.
News organisations in Australia and elsewhere choose to post news on Facebook for this precise reason, and they encourage readers to share news across social platforms to increase readership of their stories. This in turn allows them to sell more subscriptions and advertising. Over the first five months of 2020 we sent 2.3 billion clicks from Facebook’s News Feed back to Australian news websites at no charge – additional traffic worth an estimated $200 million AUD to Australian publishers.
We already invest millions of dollars in Australian news businesses and, during discussions over this legislation, we offered to invest millions more. We had also hoped to bring Facebook News to Australia, a feature on our platform exclusively for news, where we pay publishers for their content. Since it launched last year in the US, publishers we partner with have seen the benefit of additional traffic and new audiences.
But these proposals were overlooked. Instead, we are left with a choice of either removing news entirely or accepting a system that lets publishers charge us for as much content as they want at a price with no clear limits. Unfortunately, no business can operate that way.
Facebook products and services in Australia that allow family and friends to connect will not be impacted by this decision. Our global commitment to quality news around the world will not change either. And we will continue to work with governments and regulators who rightly hold our feet to the fire. But successful regulation, like the best journalism, will be grounded in and built on facts. In this instance, it is not.
The media industry has also begun to respond to Facebook’s comments which have been collected below:
Nine Entertainment Co
A Nine spokesperson said: We find it a strange response as it is a demonstration of Facebook’s use of its monopoly power while failing to recognise the importance of reliable news content to balance the fake news that proliferates on their platform.
We are ready to engage and hope to come to a constructive outcome with Facebook which will work for both of us and importantly the Australian community.
ACCC Chair Rod Sims
Facebook’s threat today to prevent any sharing of news on its services in Australia is ill-timed and misconceived.
The draft media bargaining code aims to ensure Australian news businesses, including independent, community and regional media, can get a seat at the table for fair negotiations with Facebook and Google.
Facebook already pays some media for news content. The code simply aims to bring fairness and transparency to Facebook and Google’s relationships with Australian news media businesses.
We note that according to the University of Canberra’s 2020 Digital News Report, 39% of Australians use Facebook for general news, and 49% use Facebook for news about COVID-19.
As the ACCC and the Government work to finalise the draft legislation, we hope all parties will engage in constructive discussions.
Free TV Australia CEO Bridget Fair
What we’re seeing today is a global monopoly that will say and do anything to avoid making a fair payment for news content. Australian Facebook users are being held to ransom as a tactic to intimidate the Australian Government into backing down on this issue.
This type of bullying behaviour is exactly the reason that the ACCC concluded that the Mandatory Code was the only reasonable way to even up the bargaining power between Facebook, Google and Australian News Media Businesses.
Facebook is already awash with fake news and conspiracy theories. Removing trusted Australian news from their platform will only serve to allow misinformation to be further spread unchecked and unchallenged. Unfortunately Australian consumers will be the collateral damage in Facebook’s campaign to hold onto monopoly profits.
The draft Code does no more than set an appropriate framework to allow fair negotiations between Australian News Media Businesses and digital platforms that would recognise the value of news content to those platforms.
It is reactions like this that show how important it is that the Government moves forward with the Code and in particular that it includes the ACCC’s recommended non-discrimination provisions which are designed to protect Australians from these kind of punitive and oppressive responses from giant digital monopolies.
We urge the Government to move to introduce the laws into Parliament as quickly as possible.
This article will continue to be updated as the story develops.