Facebook took the nuclear option in Australia. It may be on a collision course with at least 7 other countries.
REUTERS/Erin Scott
- Facebook has blocked Australian users from sharing news articles on its platform.
- The move comes after months of wrangling with Australian officials.
- But the tech giant also faces pressure from a growing number of governments on how it handles news.
- Visit the Business section of Insider for more stories.
Facebook blocked Australian users from sharing and viewing news articles on their feeds on Wednesday, following months of back-and-forth with local officials.
The dramatic step follows a debate with lawmakers over how to rebalance the relationship between tech platforms and legacy media outlets.
The country's proposed "news and media bargaining code" would force Facebook and Google to pay news publishers to display stories in their search results and news feeds. Should the code pass in its current form, it would impose forced bargaining on tech firms, with Facebook and Google arguing that this is unworkable.
Google initially threatened to remove its search engine from Australia altogether, saying the code would disrupt its business model. But it has since taken a softer approach, enticing news publishers -onto its Showcase platform with multi-million dollar deals. Showcase would enable users to access previously paywalled content for free. It has signed deals with some of its fiercest media critics, including media mogul Rupert Murdoch's News Corp.
Facebook, however, has taken the nuclear option: blocking Australians from sharing news content. That crackdown has inadvertently and temporarily included a host of public service institutions' pages, including fire departments and food banks.
This is the first time Facebook has taken such drastic action, but it might not be the last, because multiple regulatory agencies and governments are considering new rules around news payments.
These rules are in varying stages of progress. Insider broke down 7 of the territories around the world that are on a collision course with Facebook.
REUTERS/Lindsey Wasson
In December, the FTC slammed Facebook with two landmark antitrust lawsuits, looking into its acquisitions of Instagram and WhatsApp.
Amid mounting pressure domestically, the News Media Alliance trade body, which has close to 2,000 member organizations, has been promoting a bill for the "Journalism Competition and Preservation Act."
Under this bill — much like the proposed Australian code — publishers would be able to "collectively negotiate with dominant online platforms regarding the terms on which their content may be distributed."
Facebook has responded to such criticisms with various initiatives to fund journalism and boost news content on its platforms, such as its Journalism Project and News tab, but the impact has been modest and the industry continues to struggle.
Meanwhile, Microsoft President Brad Smith has added fuel to the fire in the past week, calling on US legislators to introduce its own version of Australia's proposals.
Canada has promised to introduce new regulations.Emma McIntyre/Getty Images
Earlier this month, Canada's heritage minister Steven Guilbeault promised to introduce new legislation that would force tech giants to pay for news content that appears on their platforms. It's not yet clear how his plans would differ from the proposed Australian code.
It came after a nationwide campaign backed by 105 local newspapers, in which all of them ran blank front pages in an attempt ot highlight the "urgent" need for reform.
In a statement, Guilbeault said: "News is not free and has never been."
He added: "Our position is clear: publishers must be adequately compensated for their work and we will support them as they deliver essential information for the benefit of our democracy and the health and well-being of our communities."
The EU looks set to follow Australia's lead.Reuters
The EU has been at the forefront of tough new data and tech regulation in recent years, bringing in the wide-ranging GDPR data protection legislation and proposals to clamp down on digital giants.
As previously reported, the EU looks set to follow Australia's lead in demanding Facebook and Google pay for news articles.
Legislators look set to build on the framework outlined in the recently proposed EU Digital Services and Digital Markets acts, though there is no detail as yet.
Speaking to the Financial Times, Maltese MEP Alex Saliba said the Australian government's approach had addressed the "acute bargaining power imbalances" between tech platforms and news publishers.
"With their dominant market position in search, social media and advertising, large digital platforms create power imbalances and benefit significantly from news content," he said. "I think it is only fair that they pay back a fair amount."
A post-Brexit UK could take tech regulation into its own hands.In December, the UK's Digital Markets Taskforce said Facebook and Google could soon be forced to pay news outlets to display their content.
The panel of experts – drawn from organizations such as broadcast regulator Ofcom and the Competition and Markets Authority (CMA) – recommended a new digital watchdog, the "Digital Markets Unit," be installed and given the power to fine tech giants up to 10% of global turnover.
"To ensure the UK can continue to enjoy a thriving tech sector, consumers and businesses who rely on tech giants like Google and Facebook should be treated fairly, and competitors should face a level playing field — enabling them to deliver more of the innovative products and services we value so highly," CMA chief Andrea Coscelli said.
"In short, we need a modern regulatory regime that can enable innovation to thrive, while taking swift action to prevent problems."
Around the same time, the UK's House of Lords communications and digital committee recommended lawmakers introduce legislation similar to Australia's, as part of the long-awaited Online Harms Bill.
In late January, the company launched Facebook News locally, offering users a dedicated feed of stories from a host of British publishers, including the Guardian and the Daily Mail.
France has a long-running copyright dispute with Facebook and Google.Getty
The French Competition Authority has been spearheading efforts to make tech platforms pay for news for the past few years.
France became the first among EU nations to implement new European copyright directives in 2019, which required Google and Facebook to pay news publishers to display their content. But both refused.
As in Australia, Google has tried to nip the 18-month dispute in the bud, signing a $76 million deal with a host of French news outlets, which will see their content licensed to appear on its Google News Showcase platform.
The dispute is ongoing.
Google has already shut down Google News in Spain.
Greg Sandoval/Business Insider
Spain was the first to introduce a so-called "Google tax" all the way back in 2014, under which the tech giant would have been forced to pay for the snippets of news it reused in its Google News platform.
Rather than take on the new costs, the firm opted to just shut down Google News in Spain altogether, and it hasn't returned.
Smaller publishers have been feeling the pinch ever since, with industry analysts suggesting publishers were missing out on around $1 billion in revenue between them as a result.
Spain has yet to introduce any new proposals on the tech-media relationship, but is definitely one to watch.
Germany considered fining Facebook for fake news.Bernd von Jutrczenka/Reuters
At the height of the Cambridge Analytica scandal, German lawmakers acted fast in trying to clamp down on viral misinformation.
Under proposals put forward in 2016, the German government suggested Facebook should pay around half-a-million dollars for every "fake news" post it let slip through its radar.
"If after the relevant checks Facebook does not immediately, within 24 hours, delete the offending post then [it] must reckon with severe penalties of up to 500,000 euros," lawmaker Thomas Oppermann said in an interview with Germany's Der Spiegel magazine.
In 2019, four German publishing groups — including Insider owner Axel Springer — joined forces in an attempt to redirect Big Tech advertising spend back into traditional news outlets.
While there is yet to be much concrete movement from officials, you can be sure German legislators will be watching events in Australia keenly.
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