Facebook threatens to stop Australians sharing news articles on its platform

Facebook has denied it benefits from news being shared on its platform.
Facebook has denied it benefits from news being shared on its platform.

The federal government has vowed it won't be bullied by tech giant Facebook after it threatened to stop Australians sharing local news articles.

Facebook said on Tuesday it was considering banning local news articles from its platform if the ACCC's draft bargaining code becomes law.

But the Australian competition and consumer watchdog described the warning as "misconceived" and Treasurer Josh Frydenberg said the Morrison government would not bow to "coercion".

"We won't be bullied no matter how big the international company is. No matter how powerful they are. No matter how valuable they are," Mr Frydenberg said.

The world-first news code would allow media companies to bargain with Google and Facebook over payment for news content on its platforms.

It is designed to address bargaining power imbalances between Australian news media businesses and digital platforms.

"While bargaining power imbalances exist in other areas, the bargaining power imbalance between news media businesses and major digital platforms is being addressed as a strong and independent media landscape is essential to a well-functioning democracy," the ACCC said.

But in a statement on Tuesday, Facebook said the code "misunderstands the dynamics of the internet and will do damage to the very news organisations the government is trying to protect".

"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," Facebook said.

"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."

Facebook also denied it benefitted from news being shared on its platform.

"The ACCC presumes that Facebook benefits most in its relationship with publishers, when in fact the reverse is true. News represents a fraction of what people see in their news feed and is not a significant source of revenue for us," the company said.

The company said it flagged plans bring Facebook News to Australia - a feature which provided users with the top headlines of the day and personalised news, and paid some publishers - during negotiations over the regulation.

"Since it launched last year in the US, publishers we partner with have seen the benefit of additional traffic and new audiences," Facebook said.

"But these proposals were overlooked. Instead, we are left with a choice of either removing news entirely or accepting a system that lets publishers charge us for as much content as they want at a price with no clear limits. Unfortunately, no business can operate that way."

ACCC Chair Rod Sims said the threat was "ill-timed and misconceived".

"Facebook already pays some media for news content. The code simply aims to bring fairness and transparency to Facebook and Google's relationships with Australian news media businesses," Mr Sims said.

"We note that according to the University of Canberra's 2020 Digital News Report, 39 per cent of Australians use Facebook for general news, and 49 per cent use Facebook for news about COVID-19."

Mr Frydenberg said while Facebook and Google were popular with Australians, they should be expected to pay a fair price for the benefit they received from content.

"People love them. And we want those to continue here in Australia. But we also believe our world leading reforms based on the work of the ACCC is the future for a more sustainable media environment"

The statement comes two weeks after Google warned it may withdraw free services from Australia if the code went ahead.

"(The code) could lead to your data being handed over to big news businesses and would put the free services you use at risk in Australia," Google Australia managing director Mel Silva said.

Mr Sims said at the time Google's open letter contained misinformation about the code.

"Google will not be required to charge Australians for the use of its free services such as Google Search and YouTube, unless it chooses to do so," he said.

"Google will not be required to share any additional user data with Australian news businesses unless it chooses to do so."

Tech giants are fighting against the code in order to prevent setting a worldwide precedent for the payment of news.

Newsrooms across the globe have been hit hard by the coronavirus pandemic, with advertising revenue drying up.

Around 180 newsrooms have closed in the first half of 2020, according to the Public Interest Journalism Initiative.

This story Why you may no longer see news articles on your Facebook feed first appeared on The Canberra Times.