The Australian government has blinked first.
Facebook has negotiated amendments to Australia’s controversial “media bargaining code”, and has agreed to restore news content for Australian users in the coming days.
In a blogpost, Facebook said the Australian government has agreed to a number of amendments to the Media Bargaining Code following negotiations, and guaranteed to address the company’s core concerns “about allowing commercial deals that recognize the value our platform provides to publishers relative to the value we receive from them”.
Campbell Brown, VP, Global News Partnerships, said that the Australian government had clarified that tech company will not have to pay for news. Brown said negotiations took place between Treasurer Josh Frydenberg, Communications Minister Paul Fletcher, and Mark Zuckerberg, reported the Sydney Morning Herald.
According to publication, the last-minute amendments include a two-month mediation period that would give news publishers and Facebook more time to negotiate commercial deals. If a deal is struck, Facebook would not have to enter a forced arbitration under the Code, where it would have to agree to a binding offer set by an arbiter. “Going forward, the government has clarified we will retain the ability to decide if news appears on Facebook so that we won’t automatically be subject to a forced negotiation,” Brown said.
“Facebook has refriended Australia. Australian news will be restored to the Facebook platform, and Facebook has committed to entering into good-faith negotiations with Australian news media businesses and seeking to reach agreements to pay for content,” Frydenberg said on Tuesday.
Last week, Facebook had banned all users in Australia from viewing or sharing news articles (more on that at the end).
- Australia has been working on a Media Bargaining Code for about three years. This is being debated in Parliament and may be passed into law on Wednesday.
- The Code forces Google and Facebook to enter an arbitration deal with news publishers to decide a price for their news stories. As Splice Media’s Alan Soon puts it, “both companies will pull numbers out of their assess”, and the arbiter will pick a fair price. A publisher would bring a case against the platform to an arbiter, who would decide how much these links are worth, Soon explains.
- The Australian government’s justification has been to resolve the “fundamental power imbalance” between news publishers and tech platforms.
Facebook had warned that the code was unviable and had in September threatened to pull all news content in Australia. At the time, Facebook had said that it was 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”, and that “unfortunately, no business can operate that way”. Last week, it went ahead on its warning. Facebook claimed that it was forced to implement the ban as the proposed media bargaining code “fundamentally misunderstands the relationship between our platform and publishers who use it to share news content.”
Facebook’s ban, and Google’s NewsCorp deal
Last week, Facebook had restricted viewing and sharing of news content; international publications can continue to publish their content but they won’t be visible in Australia. Facebook’s blockade was also imperfect as dozens of links from NGOs, government health departments, pages offering information on the infamous Australian bush fires, and even Facebook’s own Facebook Page got swept up in the ban.
Google had also warned users that the code would lead to a dramatic drop in search results on both Google Search and YouTube. But last week, the company signed a global multi-year deal with NewsCorp. As part of the deal, the internet giant will offer the company’s publications “significant payments” for featuring them in its News Showcase.
The extent of the deal goes well beyond Australia — publications like The Wall Street Journal, Barron’s, MarketWatch, and the New York Post in the US, the UK’s The Times and The Sunday Times, and Australia’s The Australian, news.com.au, Sky News, and a bunch of other regional news outlets will reap dividends of this deal.
As of now, News Corp, Guardian Australia, and Seven West Media have begun negotiating with Facebook.