People in Australia can no longer find news on Facebook (FB).
Facebook said Wednesday that people and publishers in Australia cannot share and view news from local and international outlets. The announcement is a response to proposed legislation in Australia that would force tech platforms to pay news publishers for content.
“What the proposed law introduced in Australia fails to recognize is the fundamental nature of the relationship between our platform and publishers,” Campbell Brown, Facebook’s vice president of global news partnerships, wrote in a blog post. “Contrary to what some have suggested, Facebook does not steal news content. Publishers choose to share their stories on Facebook.”
“I hope in the future, we can include news for people in Australia once again,” Brown added.
During a January hearing in Australia’s senate, Facebook had suggested it could block content in the country if the bill becomes law. Google (GOOG) threatened in the same hearing to shut down its search engine in Australia altogether.
But before Facebook’s announcement Wednesday, Google signaled that it’s headed in the opposite direction — rather than leaving Australia, it appears to be deepening its relationships with publishers there.
Google and News Corp (NWS) — the Rupert Murdoch-owned news conglomerate that includes much of Australian media as well as some UK outlets and the Wall Street Journal and New York Post in the United States — announced a three-year deal under which the tech giant will pay to license News Corp. content.
Australia fires back
Australian Treasurer Josh Frydenberg on Thursday blasted Facebook’s actions as harmful to its presence in the country, calling the potential legislation “important” reform.
“Facebook was wrong,” Frydenberg said at a press conference. “Facebook’s actions were unnecessary, they were heavy-handed, and they will damage its reputation here in Australia.”
He singled out blocks on access to certain government sites related to the coronavirus pandemic, emergency services, weather reports and other issues as “completely unrelated” to the media code.
“What today’s events do confirm for all Australians is the immense market power of these media digital giants,” Frydenberg added.
The idea that tech companies should have to pay for content on their platforms has been pushed by publishers for some time now, and Murdoch and News Corp have been one of the fiercest proponents. The fight has become more pressing for the tech platforms as regulators in the United States, Australia and elsewhere consider new laws on the matter.
In recent years, Facebook and Google have debuted programs to pay for news. Facebook, for example, created Facebook News, a section of the app featuring curated news stories where selected publishers are paid for participating. William Easton, managing director of Facebook Australia and New Zealand, wrote in a blog post on Wednesday that Facebook was set to launch the feature in Australia but only “with the right rules in place.”
Setting a precedent
“This legislation sets a precedent where the government decides who enters into these news content agreements, and ultimately, how much the party that already receives value from the free service gets paid,” Easton said. “We will now prioritise investments to other countries, as part of our plans to invest in new licensing news programs and experiences.”
Google announced its plans to license news last year and revealed a new product called News Showcase in which publishers can curate and decide for themselves how to present their content on the platform. Google committed $1 billion over three years to the program. The company has since partnered with more than 500 publications worldwide, Don Harrison, president of global partnerships at Google, said on Wednesday.
As part of Wednesday’s agreement, News Corp publications in the United States, United Kingdom and Australia will participate in News Showcase.
But News Corp’s deal with Google extends beyond News Showcase. News Corp said in its press release that the partnership will include developing a subscription platform, sharing ad revenue and investing in audio and video journalism.
Google declined to share the terms of the deal, but News Corp’s press release claimed it will receive “significant payments.”
News Corp CEO Robert Thomson thanked Google CEO Sundar Pichai and his team for showing a “thoughtful commitment to journalism that will resonate in every country.” Thomson also held up the partnership as a major win in the company’s long fight against tech platforms.
“This has been a passionate cause for our company for well over a decade and I am gratified that the terms of trade are changing, not just for News Corp, but for every publisher,” Thomson said in a statement. “For many years, we were accused of tilting at tech windmills, but what was a solitary campaign, a quixotic quest, has become a movement, and both journalism and society will be enhanced.”