Facebook power move

What did a news ban achieve and what will a new bargaining code mean for Australia's media landscape?

Facebook took Australian users on a rollercoaster ride this month, sensationally banning news sites and news links on their platform only to backflip on the decision five days later.

A number of non-news pages were also inadvertently banned – including government and emergency services, and a range of community information sites.

The shocking ban on news came in response to escalating tensions over the government's proposed media bargaining laws. This world-first legislation would force the tech giants to negotiate a fair payment with news publishers for using their content.

Facebook announced it would reverse its block on Australian news after the government agreed to make amendments to the laws.

According to reports by The Guardian:

  • The changes mean the government may not apply the code to Facebook if the company can demonstrate it has signed enough deals with media outlets to pay them for content.
  • The government has also agreed that Facebook and other platforms that would be subject to the code would be given a month’s notice to comply.

While news sharing has been restored – at least for now – the events of recent days have left many questions unanswered.

How did it come to the point where Facebook felt they needed to pull Australian news content? What will the media bargaining code aim to achieve, and how will it impact everyday audiences?

Contact asked experts from UQ's research and alumni community to weigh in on what this means for the future of Australia's media landscape.

Image: Joshua Hoehne/Unsplash

Image: Joshua Hoehne/Unsplash

Professor Peter Greste

UNESCO Chair in Journalism and Communications
School of Communication and Arts

What a week for whiplash! First Facebook bans the sharing of Australian news content in reaction to the Australian Government’s News Media Bargaining Code and, in the process, blocks a host of patently non-news websites, (including the University’s School of Communication and Arts page). Then, less than a week and a few tweaks to the legislation later, Aussie news is back on. 

So, is everything back to normal? Not quite. Depending on where you sit, Facebook’s move was either a heavy-handed overreaction to a new law designed to get them to pay for public-interest journalism; or the natural consequence of an ill-conceived piece of government legislation.

The neck-snapping changes of direction reveal a few fundamental truths. First, news still matters to Australians. Within a few days of Facebook’s decision to ban Aussie news, the ABC News app shot to number one on Apple’s App Store rankings. It stayed stubbornly near the top, thumbing its nose at Facebook’s own app, which consistently hovered several places lower.

That suggests we really do care about quality news, and if we can’t get it on our preferred social media platform, we’re prepared to work a little harder for it.

It was also encouraging for the big national media companies like News Corp, the ABC, or The Guardian, which saw surges of direct attention. For them, Facebook is one pipeline among many, so while losing access to the social media giant was a blow, they still have their own websites, apps, TV and radio services to fall back on. They are also big enough to demand decent payment for their content when it comes to negotiating deals, as some have already done with Google. 

But what of the small local and hyper-local news services that creatively found ways to flourish in the ‘news deserts’ spreading across more thinly-populated parts of regional Australia? Rather than fighting the digital disruption, many built their business around Facebook. Often run by one or two dedicated people, they show up to the school fetes and chase the council about long-overdue roadworks. Those are far less likely to survive a repeat of the digital lockdown.

However, Facebook has legitimate complaints about the News Media Bargaining Code at the heart of this dispute. It has complained that it feels like a shakedown of the wealthiest digital giants, to prop up old media dinosaurs which have struggled to develop their own digital offerings. The Australian Government says the new code will help small news startups too, but it’s hard to shake the impression that the system entrenches old news companies rather helping than the new.

If nothing else though, this spat has reminded Australians that strong, independent and professionally produced news matters, and that something has to be done to protect what should be thought of as a public good, rather than a profit-making product. It is still not clear that the news media bargaining code is the way to do it.

Image: Kambookpics/Pexels

Image: Kambookpics/Pexels

Danielle Cronin

Brisbane Times Editor
UQ graduate (Bachelor of Arts '92)

Facebook had issued the threat but media organisations were still caught off guard when Australian news was purged from the social media platform overnight.

Crucial government agencies and essential support services were initially collateral damage, with Queensland Health, Bureau of Meteorology and 1800Respect pages also taken down. 

While Facebook has struggled with stemming the spread of hate speech and conspiracy theories on its platform, 'unfriending' news did not seem troublesome.

The ban created a vacuum, carving out more space for misinformation and disinformation to flourish unchecked by accurate, quality reporting on issues important to our community.

Even before the restrictions, credible reporting was outgunned on the platform by the promoters of alternative facts, the fake news brigade, and the self-styled experts who afford more credence to search engine results than peer-reviewed journals. 

The community is poorer for it, particularly the significant number of Australians who primarily access news via Facebook and are served up content based on the platform’s nebulous, ever-changing algorithms. 

The ban was short-lived. The social media giant made a u-turn within days, lifting its news restriction after the Australian Government agreed to 11th-hour changes to its proposed media bargaining code dubbed a 'world-first'. 

Facebook selected the nuclear option to avoid setting a global precedent, but it starkly highlighted the issue that the media bargaining code seeks to address – the power imbalance.

Quality reporting adds value and credibility to these platforms, which rake in about 81 cents in every $1 of digital advertising and enjoy a near-monopoly on search and social media.

The code seeks to slightly move the dial to support news outlets that invest in journalism important to our community and democracy. A robust, sustainable media industry benefits everyone, from the man in Silicon Valley to the reader in Salisbury, who wants the latest news on the COVID-19 vaccine roll-out. 

Image: Solen Feyissa/Unsplash

Image: Solen Feyissa/Unsplash

Associate Professor Nicholas Carah

Deputy Head of School
School of Communication and Arts

If news publishers were concerned about Facebook and Google stealing their content, they’ve always had a simple fix. They could easily remove their website from Google’s search results and choose to stop publishing content on Facebook.

But, they haven’t.

Yes, Facebook gives news publishers ‘free’ access to audiences. But, at the same time, it monopolises attention and advertising markets to such a degree that it has withered away other channels. News publishers felt like they had no choice.

If we decide that news matters to the ongoing creation of a cohesive society, then we need to find some way to pay for it.

The government’s news media bargaining code has arguably served as a catalyst to force the platforms and major news organisations to cut a deal with each other.

That left Facebook with two options: pay for the news, or ban the news. They chose to ban it in order to create a position from which they could negotiate how they would pay for it on their own terms. 

The emerging deals involve Google and Facebook paying major news organisations like News Corp, Seven West Media, The Guardian and Nine in exchange for distributing their content on their platforms.

These look like win-win deals for the platforms and the major news publishers. The platforms have successfully avoided becoming subject to the negotiating terms of the code, but also more importantly avoided having their advertising model seriously regulated or curtailed.

They get to continue their monopolistic domination of advertising and audience markets. The major news organisations get an injection of cash that, for the time being, saves them from further downsizing and restructuring. 

It's hard to see, though, how this settlement will improve public-interest journalism or news diversity. It favours the interests of the bigger players. Many smaller publishers are still just as vulnerable to the whims of the platforms.

Furthermore, the platforms could now be more inclined to promote news coming from the major news organisations – seeing as they are now paying for it. 

Although it only lasted about a week, we ought to seriously consider if Facebook's news ban was a good thing. Some of us might have enjoyed the preponderance of neighbourhood chatter, posts from groups and cat photos that filled our feeds. The world went on – we sought our news from elsewhere easily enough.

A week without news on Facebook illustrated vividly that whatever the answer is to how to best provide a way of publishing and circulating news in the digital era – the answer is most certainly not Facebook.

It sends a message to the world that the time has come for the public, and their democratically elected governments, to set the rules about how platforms ought to operate, and what responsibilities they have.

On the upside, we can at least say that in Australia we’ve begun the process of reckoning with important questions about what diverse and public media will look like in the platform era.

On the downside, we have also seen how ruthless the platforms are as negotiators. Facebook and Google – despite their rhetoric about ‘connecting the world’ – swiftly moved to protect their duopoly status and remain among the largest and most rapacious advertising companies the world has ever seen.

The deals that emerge require all news publishers to continue adapting themselves to the commercial priorities of platforms whose number-one priority is to capture our attention and sell it to advertisers. 

Image: Obi Onyeador/Unsplash

Image: Obi Onyeador/Unsplash

Associate Professor Sarah Kelly

Co-leader of the Trust, Ethics & Governance research hub and Marketing Discipline leader
School of Business

Facebook's manoeuvre demonstrates the extent of power and influence big tech has over governments, as well as its potential impact on the future of democracy.

It potentially sets a precedent for threatening behaviour with far-reaching consequences when the interests of powerful companies are not aligned with government policy.

What if a company offering an essential service – like energy, healthcare or transport – withholds the service in response to government policy?

The ethics of this approach are questionable. How can an entity like Facebook wield such power over us? 

Trust in Facebook’s brand has been broken, and Facebook has responded by lifting the ban in an effort to rebuild trust. However, impacts of their 'hammer-and-dance' actions may adversely affect the brand longer term.

Many Australians are now boycotting Facebook, and changing their behaviour to access news elsewhere. This move – along with mounting scepticism directed at the company following a Congressional enquiry, questionable approaches to privacy and monetisation of consumer data, along with a growing monopoly through acquisition of popular platforms – will not help the brand image, or trust in it. 

The proposed legislation is aimed at ensuring that news media content is adequately compensated by big-tech sites, which post it through links and monetise it through associated advertising. The bill is a world-first and is being watched by governments around the world.

The big-tech companies claim that it's only the link snippets they post, and not the full articles. They also claim that it's a slippery slope when one sector claims payment for content, with a potential floodgate of other sectors also demanding payment for content. This puts free internet access for all at risk.

They point out that there are alternatives, like private agreements – such as those struck recently with Seven West Media – or the use of platforms such as Google News Showcase.

However, the substance of the negotiations and debate between the big-tech sector and the Australian Government is irrelevant.

The critical issue is whether it is ethical and legal for big tech – or any other sector – to use monopoly power to attempt to interfere with democratic process by cutting services. 

Image: Cottonbro/Pexels

Image: Cottonbro/Pexels

Dr Barbora Jedlickova

Senior Lecturer
School of Law

The reason Facebook banned news content in Australia needs to be put into the context of the legal and policy steps which led to it.

In December 2017, the then-Treasurer Scott Morrison directed the Australian Competition and Consumer Commission (ACCC) to conduct the Digital Platforms Inquiry (DPI), which surveyed the impact of digital platforms on the supply of news.

The final report was issued on 26 July 2019. Among other things, the ACCC found imbalances in bargaining power between digital platforms and news media. The ACCC proposed to address the digital platforms’ significant bargaining power by facilitating a code of conduct.

In December 2019, the Australian Government directed the ACCC to develop a voluntary code of conduct. In April 2020, the voluntary character of the conduct was changed to mandatory, which has now taken the form of a bill: the Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2020.

If approved, this mandatory code of conduct will, among other things, require digital platforms to pay news media for news content. This is a world-leading initiative, with Australia being the first country in the world to enforce such payments.

Therefore, if the code is approved, the profits that digital platforms generate from sharing news in Australia will shrink due to the payments to news media.

By blocking news content for several days, Facebook, as a private entity, executed its right to deal with whom it wants. This derivative of contractual freedom is limited by other freedoms and various legislative restrictions such as competition law. (For instance, refusing to deal can, under certain circumstances, constitute misuse of market power in situations where an entity has significant market power.)

Facebook's short-lived ban illustrates that the company is a powerful digital platform and that this power is not just the result of market shares and high barriers to entry. Instead, in the digital economy in which we live, power (including market power) is about information, its collection, access and distribution.

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect those of The University of Queensland.

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This year marks 100 years since UQ first began offering journalism to students. To celebrate the milestone, Contact will be publishing regular features this year tackling the major issues facing the industry today, while celebrating the success of UQ’s journalism students, graduates and the School of Communication and Arts. Keep checking the Contact website throughout the year to view these stories.