Social media platform Facebook on Tuesday threatened to block users and media organisations in Australia from sharing news stories if a government plan to force digital giants to pay for content is approved. All major media companies in Australia, such as News Corp Australia, Nine Entertainment and Guardian Australia, have backed the plan, to offset their loss of advertising revenue to Facebook, The Guardian reported.
“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,” Will Easton, the managing director of Facebook Australia and New Zealand, said in a blog post. “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.”
Easton claimed that the new legislation misunderstood “the dynamic of the internet” and will damage the news organisations it seeks to protect.
“We already invest millions of dollars in Australian news businesses and, during discussions over this legislation, we offered to invest millions more,” Easton said. “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.” However, he added, these proposals were overlooked. He said that no business can operate in such a way that publishers can charge it any amount they want for as much content as they desire.
The Australian Competition and Consumer Commission released the first version of the proposed legislation in July, The Sydney Morning Herald reported. The proposal will provide three months’ time to Facebook and Google to negotiate revenue-sharing agreements with media companies before an independent arbitrator is called in to impose a compulsory arrangement. Facebook and Google also have to provide advance notice of algorithm changes and information on how and when they make data available for publishers.
“The proposed law is unprecedented in its reach and seeks to regulate every aspect of how tech companies do business with news publishers,” Easton said. “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.”
Treasurer of Australia Josh Frydenburg said that the government cannot respond to “coercion or heavy-handed threats” and will go through with the legislation.
Australian Competition and Consumer Commission Chairperson Rod Sims called Facebook’s threat “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,” Sims said. The chairperson added that the new code simply proposed to bring fairness and transparency to the relationships between Facebook/Google and Australia news media organisations.