How are social media platforms threatening journalism?

The recent dispute between Australia and Facebook has caused global outrage and exacerbated the issues between social media and traditional journalism.

The dispute arose because Australia proposed legislation that would require platforms, such as Facebook, to pay publishers if news content was posted on their sites. In response, on 18th February, Facebook decided to block all local and global news from being shared to its users in Australia, as well as making people outside the country unable to read or access any Australian news publications on the platform. 

Australian Prime Minister Scott Morrison described Facebook’s move to “unfriend Australia” as them being “as arrogant as they were disappointing”, and urged Facebook to follow Google’s lead to work constructively with the government to find a better solution.

Morrison argues that Facebook was trying to intimidate Australia. Julian Knight, the head of the British parliamentary committee overseeing the media industry, referred to Facebook’s conduct as “bully boy action”. It seems that Facebook was trying to exert its control over Australia to push away the legislation that they saw as a potential risk to their business.

For every A$100 spent by Australian advertisers, A$49 went to Google and A$24 to Facebook

The Australian Competition and Consumer Commission (ACCC) had drawn up the proposed laws to “level the playing field” between the social media platforms and publishers struggling due to lost advertising revenue; in 2018, for every A$100 spent by Australian advertisers, A$49 went to Google and A$24 to Facebook. This seems somewhat unfair and the legislation aims to change this, with ACCC chairman Rod Sims saying that “the code simply aims to bring fairness and transparency to Facebook and Google’s relationships with Australian news media businesses”.

However, Facebook claims that the legislation “fundamentally misunderstands” the relationship between the platform and publishers, and unfairly penalises their platform. They said that the law left them “facing a stark choice: attempt to comply with a law that ignores the realities of this relationship, or stop allowing news content on our services in Australia”.

Facebook and Google argue that they help news publishers by driving traffic to their platforms and simply helping people find news content in the first place. Facebook claimed that it helped Australian publishers earn about A$407 million last year through referrals, while their gain from news was “minimal”. William Easton, the company’s local managing director, stated that the legislation would “penalise Facebook for content it didn’t take or ask for”, making Facebook sound like an unwilling participant in the distribution of news.

There has been outside support for Facebook’s view too, with Sir Tim Berners-Lee, the creator of the world wide web, saying that he was concerned that forcing companies to pay for certain content could make the internet “unworkable”.

Nevertheless, some business experts agreed with the Australian law, arguing that tech firms should pay publishers for the news content that they repost, especially with media companies suffering a decline in advertising revenue in recent years in contrast to Google’s and Facebook’s rising advertising revenue. This is down to the fact that social media has made news consumption far easier and more convenient for many people, leaving many more traditional publishers left by the wayside. 

Michael Wade, a professor at the IMD Business School in Switzerland and Singapore, stated “Google, Facebook and others have been getting away with giving it away for free for too long”, implying that these tech giants have been unfairly reaping the benefits of others’ work to the detriment of media companies.

37% of Australians said they had gained access to news via social media, in contrast to only 14% of Australians paying for online news

Facebook’s conduct angered much of the population especially because, according to the Reuters Digital News Report for 2020, 37% of Australians said they had gained access to news via social media, in contrast to only 14% of Australians paying for online news. This shows how popular social media has become for consuming news. It is this lack of use of online news that has caused the issues as if the public used traditional news sites more often, such legislation would never have been needed and, thus, Facebook would never have resorted to such measures.

Some claim that Facebook’s actions could have actually been harmful to the Australian population, with the ban on news sites potentially leading to a greater prominence of unverified and untrusted information by non-news sites, which is especially worrying in these pandemic times. First Draft, a site which investigates the spread of false and misleading posts online, warned the restrictions will “open up a vacuum that could be filled in part by mis and disinformation”.

Similarly, Human Rights Watch’s Australia director said Facebook was censoring the flow of information in the country, calling it a “dangerous turn of events”, while Western Australia Premier Mark McGowan accused Facebook of “behaving like a North Korean dictator”. This shows the level of dissatisfaction with Facebook’s actions and how many are beginning to worry about the power that they yield.

Perhaps strangely, Facebook’s action came only hours after Google agreed to pay Rupert Murdoch’s News Corporation for content from news sites, which include The Sun, The Times and the Australian. Robert Thompson, News Corporation chief executive, stated: “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”. Thompson attributed “particular thanks” to the Australian politicians who backed the ACCC proposal. This is despite Google having previously threatened to withdraw its primary search engine from Australia, suggesting that perhaps Google realised that resistance was futile and chose to give in, rather than carry out its threats.

The spat between Australia and Facebook finally came to an end on 23 February, when Facebook agreed to reverse its decision and to make payments to Australian media companies. Speaking on the reversal of the ban, Campbell Brown, vice president of global news partnerships at Facebook, said: “We have come to an agreement that will allow us to support the publishers we choose to, including small and local publishers.”

Reuters has reported that bipartisan members of Congress are planning to introduce a bill similar to the Australian legislation

Only a couple of days after the reversal, the legislation, now called the News Media Bargaining Code, was passed by the Australian legislature, with the aim that it would create a “fairer” negotiation process between tech giants and news organisations.

However, there had been last-minute amendments to the code, caused in part by Facebook’s actions, that implemented a measure that the government must consider a platform’s existing contributions to journalism before applying the code to them. This means that Facebook and Google could escape this process entirely, showing how Facebook’s hostile conduct might have benefited them to the detriment of Australian news sites.

Since these events unfolded, Facebook has signed at least one deal with a news group and is in talks with others to sign more. In addition, both firms have committed to spending $1 billion each in the news industry globally over the next three years. But it could be argued that this is merely a move to garner positive publicity after the recent criticisms against them on this issue.

Facebook’s actions may have wider implications outside of Australia with growing demands in the US that Facebook should reign in its vast influence. Reuters has reported that bipartisan members of Congress are planning to introduce a bill similar to the Australian legislation, while Canadian Heritage Minister Steven Guilbeault confirmed plans to proceed with a law that would require tech giants, such as Facebook, to pay news outlets for stories. 

The UK has also expressed an interest in Australia’s law. Oliver Dowden, the British Culture Secretary, has stated: “The rise of online advertising has created a fundamental imbalance between publishers, advertisers and the online platforms upon which they increasingly rely.” He continued that “it’s time to even the playing field”, implying that Britain, like Australia, sees social media as a threat to journalism and may be willing to legislate on this.

In conclusion, the Australian legislation aims to alleviate some of the issues that news sites have had with social media taking over their industry and, while Facebook has shown itself as prepared to retaliate, similar legislation looks to become more prevalent globally over the next few years. This should give journalism much more of a fighting chance against social media, but social media will always be a serious threat.