The Australian government argued that Facebook made money from the news stories shared on its platform. So it proposed a law that would force Facebook to pay the Australian publishers who create them.
Facebook responded by unilaterally banning Australian news stories.
Its bans are always a bit haphazard. The ban on news blocked the pages and posts of non-news organisations. These included the Facebook pages for coronavirus vaccination information, the Australian Bureau of Meteorology and Facebook’s own Facebook page.
What is remarkable is that, in response to this straightforward bit of corporate blackmail, it took less than a week for Australia to backtrack.
Facebook can now offer different publishers whatever amount it wants, including nothing at all, without risk of penalty.
Facebook gloated, “We have come to an agreement that will allow us to support the publishers we choose to. 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 a forced negotiation.”
On the same day that Facebook launched its ban, Google announced a multi-year deal with Rupert Murdoch’s News Corp. It owns around 65 percent of print newspaper readership in Australia and is a controlling shareholder in various media outlets in the country.
Partially the different strategy is down to news being more important to Google than Facebook. Partially it was because the Australian government is already under News Corp influence. There are different ways of bribing—or, as politicians like to put it, lobbying—for influence.
The payment for publishers isn’t the issue. Facebook and Google don’t mind spending money if it increases the power to make more money.
Keeping their main advantage as platforms is vital. They aggregate huge amounts of free information and profit from the ways they can organise, distribute, and sell our own information back to us.
If there were a law that said Google has to pay for information in its search index the thing that makes them work as a capitalist interest is at risk. It would be the same if Facebook had to pay to have some kinds of information in its News Feed.
As Google’s Melanie Silva said, “The concept of paying a very small group of website or content creators for appearing purely in our organic search results sets a dangerous precedent for us that presents unmanageable risk from a product and business-model point of view.”
It is worth noting that the news publishers after the cash in Australia are the normal unpleasant corporate media. If the law was passed here the main beneficiary would have been the Daily Mail. And governments aren’t the good guys in these battles.
The Indian government has announced new rules to regulate social media. The rules are to be brought after Twitter ignored orders to drop content on farmers’ protests against the government. There is a suitable period for some lobbying to take place.
Facebook and Google are both perfectly willing to throw money at publishers to hold back regulations.
First they gave grants. Google started the Digital News Initiative and Facebook had the Journalism Project. Then Facebook started making deals with publishers for their stories to appear in a separate tab, a new Facebook News Tab, curated by Facebook editors.
Google has made deals in a number of countries that are about to legislate in similar ways to Australia to do the same thing.
Search ads make the largest contribution to Google’s profit, but the company doesn’t say how much of that comes from news-related clicks. One study estimated that Google made £4 billion worldwide from digital advertising on news searches in 2018.
Facebook claims, “The business gain from news is minimal.” The firm said that news accounts for less than 4 percent of the content on Facebook users’ feeds. The company had a revenue of £60 billion in 2020.
The battle over information and who profits has many bad actors and little likelihood of a happy ending coming from any of the sides.