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News Flash

March 8, 2021
Editor(s): Emily Hartley

Indisputably, the way in which we have accessed news stories over time has been profoundly impacted upon by the ever-growing presence and role of technology within society. Where newspapers and televisions were once the primary source for relaying current affairs, individuals worldwide have since become increasingly reliant on social media as a central platform for receiving their latest news fix. In fact, in a study conducted by the News and Media Research Centre at The University of Canberra (2020), 39% of Australians were found to have used social media as a source of news.

Therefore, it was inevitable that Facebook’s recent ejection of all Australian News sources from their platform would call for a strong sense of controversy and reproval amongst governments and politicians worldwide. The change that hit the social media site on Thursday morning does, indeed, raise concerns as to the true power that social media platforms, like Facebook, have established. However, with a decision this significant, it is necessary to delve into the roots of the cause and assess what really engendered Zuckerberg to act on such a move.

It is important to acknowledge that the tension between Facebook and the Australian Government did not suddenly emerge within recent weeks, rather Facebook’s threats to pull Australian News Sources extend back to September 2020, where talks of Australia’s initial proposals for new media bargaining laws increased. It wasn’t until these proposed laws were successfully passed through the lower house on the 17th of February 2021 that Facebook decided to turn their words into actions and pull the news sources from their platform completely.  

The new bargaining code was set to require social media platforms, like Facebook, to commence paying news and media outlets for the content posted to their platforms. The bill for the law, which was established in May 2020, came as a response to perceived bargaining power imbalances between Australian news media outlets and digital platforms.

If the response to consequently remove all news sources completely was not already a clear indicator of the company’s refusal to cooperate with the Governments proposals, Facebook’s Australian and New Zealand managing director, Will Easton, entrenched the company’s negative stance the morning the change unfolded. In a blog post, Easton wrote: “The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news contents. It has left us 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. With a heavy heart, we are choosing the latter.” The relationship implied within his text is that of which Australian News Sources voluntarily post their content to the platform, rather than are required to as they are with companies such as google, in whom were also amongst the digital platforms in mentions of the bargaining code. The tech giant, in fact, believes that more is to gain by the News outlets than Facebook itself from the posting of news content, mentioning that ‘the value exchange between Facebook and publishers runs in favour of the publishers.’ The company also provided to the public the fact that news content accounts for less than only 4% of all content shared, indicating lack of business benefit from the inclusion of these outlets.

It is also necessary to consider additional reasons as to why Facebook reproves of Australia’s proposed media bargaining laws. It may be the case that should Facebook choose to abide by the new laws, they would not be left to foot the bill only to Australian media outlets. It would not be too soon after that a myriad of countries worldwide would follow suit and call for the same changes to be made, potentially costing the tech giant millions of dollars. Not only this, however, failure to comply with the bargaining code would set the company behind in fines worth 10% of their local revenue.

There are large doubts that the change was justified. In a tweet published that morning, Prime Minister Scott Morrison labelled the actions of Facebook as ‘arrogant’ and ‘disappointing’. He proceeded to mention that the company’s decision ‘confirm(s) the concerns that an increasing number of countries are expressing about the behaviour of BigTech companies who think they are bigger than governments and the rules should not apply to them.’

Additionally, it wasn’t strictly news pages that were collateral during the big change enacted the morning after the bill passed the lower house. Government agencies, such as those concerning health and emergency services like the Bureau of Metereology and state health pages, as well as charities targeted at helping stop domestic violence, such as Small Steps for Hannah, were also removed from the company’s platform, sparking concerns as to how appropriately the change was implemented. These pages were shortly after restored, with Facebook responding that the initial removal of government pages was as a result of a misinterpretation of the Australian Government’s definition of News Sources.

As it stands, Australian Treasurer, Josh Frydenberg, has indicated that negotiations will continue to occur with Zuckerberg, after a lengthy and constructive conversation was held between the pair that morning. Nevertheless, it is indisputable that the change imposed will encourage Australians to reconsider where and how they are receiving their news.

References

Samios, Z. L. V. (2021, February 17). ‘A real shock’: Media companies slam Facebook’s Australian news restrictions. The Sydney Morning Herald. https://www.smh.com.au/world/north-america/facebook-to-restrict-australians-sharing-or-viewing-news-content-20210218-p573j8.html#comments

Francis, D., Rigby, B., & Francis, D. (2021). Facebook to restrict news sharing in Australia, will prioritise investments in other countries. Mumbrella. Retrieved 19 February 2021, from https://mumbrella.com.au/facebook-to-restrict-news-sharing-in-australia-will-prioritise-investments-in-other-countries-669029.

Why did Facebook block news in Australia? Pocket-lint (2021) Retrieved 19 February 2021, from https://www.pocket-lint.com/apps/news/facebook/155783-why-did-facebook-block-news-in-australia-the-blackout-explained.

Facebook’s Australia news ban: what is the social media giant up to and how will you be affected?. the Guardian. (2021). Retrieved 19 February 2021, from https://www.theguardian.com/media/2021/feb/18/facebooks-australia-news-ban-what-is-the-social-media-giant-up-to-and-how-will-you-be-affected.

The CAINZ Digest is published by CAINZ, a student society affiliated with the Faculty of Business at the University of Melbourne. Opinions published are not necessarily those of the publishers, printers or editors. CAINZ, our Partners and the University of Melbourne do not accept any responsibility for the accuracy of information contained in the publication.

Meet our authors:

Emily Hartley
Editor

Hi everyone! My name is Emily and I am a current penultimate year student studying Bachelor of Commerce with majors in Finance and Economics. As a digest writer at CAINZ, I am able to tie together my childhood passion for writing and the qualitative and quantitative aspects of finance and economics. I am excited to deliver to you a range of articles throughout my time as a writer.