Regardless of what really happened, this had the appearance of pure extortion.
In response to Australia’s new law requiring Google and Facebook to hold negotiations with news publishers aimed at compensating publishers for their content, Facebook took down not just news — which would be a proportionate response, I suppose — but all kinds of information.
The newly banned Facebook content comprises, as The Washington Post reports, “dozens of government and charity websites as well, including public health sites containing critical information about the pandemic during the first week of its coronavirus vaccine rollout.”
The information was restored about 12 hours later, and Facebook claimed it was all a mistake. Still, it was a powerful demonstration of what Mark Zuckerberg can do if you refuse to kiss the ring.
I’m hardly the first person to make this observation, but there’s a reason that Google is trying to accommodate Australian news publishers while Facebook is fighting them tooth and nail: Google needs news much more than Facebook does. The New York Times puts it this way:
Facebook and Google ultimately value news differently. Google’s mission statement has long been to organize the world’s information, an ambition that is not achievable without up-to-the-minute news. For Facebook, news is not as central. Instead, the company positions itself as a network of users coming together to share photos, political views, internet memes, videos — and, on occasion, news articles.
While I have no problem with publishers trying to extract some revenues from the two tech giants, I’m disheartened to see that Google is trying to buy its way out of trouble in Australia by cutting deals with the likes of Rupert Murdoch. This shouldn’t be a matter of buying off critics and then resuming business as usual.
That’s why I prefer an idea put forth by the tech analyst Benedict Evans in a conversation with Ingram: help fund news by taxing Google and Facebook. At least theoretically, that could lead to a more equitable distribution of revenues to large and small publishers alike.
Regardless of what the road ahead looks like, though, it’s clear that Facebook is going to be harder to deal with than Google. The Zuckerborg just doesn’t need journalism as much.
The Overton Window has opened a bit wider for the idea of requiring Google and Facebook to pay for news content. At Axios, Sara Fischer reports that Microsoft president Brad Smith has endorsed the Australian government’s move to do just that — and thinks such a system ought to be considered in the U.S. as well.
What’s taking place in Australia is complicated, but essentially it requires Google and Facebook to bargain with the news business and come up with a compensation system. Both companies have said they would stop offering some of their services if Australian authorities don’t back off.
In the U.S., the News Media Alliance, a lobbying group for news publishers, has been pushing for several years for an antitrust exemption that would allow them the right to bargain collectively with the tech giants — which is exactly what is going to happen in Australia. With the sheen wearing off Big Tech’s once-sterling image, the likelihood of Congress passing such an exemption has increased. A lawsuit brought by a group of West Virginia newspapers that I wrote about for GBH News last week may serve as a further goad.
In a blog post, Microsoft’s Smith cites a News Media Alliance study showing that Google makes an estimated $4.7 billion a year “from crawling and scraping news publishers’ content.” That study came under fire at the time of its release a couple of years ago. But regardless of the actual figure, Google — and Facebook — are surely making a lot of money from other people’s content without paying for any of it.
Smith makes no bones about his own business imperatives, saying that Microsoft is prepared to play by Australia’s rules through its Bing search engine, writing:
Microsoft’s Bing search service has less than 5% market share in Australia, substantially smaller than the 15-20% market share that we have across PC and mobile searches in the United States and the 10-15% share we have in Canada and the United Kingdom. But, with a realistic prospect of gaining usage share, we are confident we can build the service Australians want and need. And, unlike Google, if we can grow, we are prepared to sign up for the new law’s obligations, including sharing revenue as proposed with news organizations. The key would be to create a more competitive market, something the government can facilitate. But, as we made clear, we are comfortable running a high-quality search service at lower economic margins than Google and with more economic returns for the press.
A final thought. If Congress isn’t prepared to act, might it be possible to require Google and Facebook to compensate news publishers at the state level? Jack Nicas reports in today’s New York Times that a proposal has been made in North Dakota to forbid Apple and Google from collecting app-store fees from North Dakota-based businesses.
The legislation strikes me as more than a little half-baked. Yet the principle — that states can impose their own regulations on Big Tech — is one worth pondering.