Article written for the Daily Telegraph - published 18 January 2021
Facebook's decision to ban news media from its main platform in Australia is as dangerous as it is wrongheaded.
In a world going through a public health emergency, people need access to the reliable and factual information that is provided by news publishers and organisations.
Yet this content will now be inaccessible on the platform in Australia , and news from Australian media organisations has been banned from Facebook around the world. Instead, harmful misinformation and conspiracy theories on Facebook will no doubt continue to be a problem.
Facebook has taken this extraordinary decision because it is in dispute with the Australian government over new legislation that will require companies like itself and Google to pay news media organisations when their content is shared on these platforms.
The Australian government has introduced these measures following an investigation by its competition authorities into the advertising market and the financial sustainability of the news industry.
This ground-breaking investigation from the Australian Competition and Consumer Commission warned that there are serious anti-competitive behaviours in the digital ads market that risk harming both consumers and economic efficiency.
This has also been echoed by similar investigations by the UK's Competition and Markets Authority, and the US House of Representatives Antitrust Subcommittee.
The Australian investigation has shown that for every $100 of online advertising spend, $53 goes to Google, $28 to Facebook and $19 to everyone else.
This creates enormous pressure on other organisations, and in particular news companies and publishers that have in the past relied on advertising revenue in order to pay for their journalists and investigations.
The decline in ad revenue for publishers is a direct challenge to the news industry itself, which has already led to the closures of a great number of publications.
Many of those that have survived have had to make significant reductions in their staff and budgets. To preserve the future of public interest journalism, the Australian government presented a News Media Bargaining Code to parliament to oblige Facebook and Google to come to the table with news publishers and negotiate a fair deal.
Google has proactively engaged with publishers to come to a financial agreement, and I applaud them for it.
Facebook, however, has said that they should not have to pay for news on their platform when it was not placed there by them, but by their users.
This is a window into the soul of Facebook; it expects to make money from everything and everyone that uses its platform, but does not believe it should have to pay for any of it.
Facebook has a business model based on engagement. It makes money through advertising, the more time people spend on its platform, regardless of what content they're engaging with.
When people share news stories with each other, Facebook makes money out of that, even though it's made no contribution towards the creation of that piece of content.
In the music industry, YouTube pays artists when people listen to their tracks on its platform.
What the Australian Government has suggested is that in the same way, news organisations should also receive a contribution from social media platforms when people share their content on it.
This has become increasingly important as more people use companies like Facebook as a source for news. In the UK, over a third of people regularly get their news from Facebook, meaning that rather than viewing it on news websites or on broadcast channels or buying a newspaper, they principally get it through social media.
News publishers make no or very little money from this, so the Australian Government is requesting that companies like Facebook, make a contribution back for content they themselves make money out of, so that content has got a sustainable future.
This is not just an issue about the media in Australia, it's one that the whole world is looking at. Where Australia leads, other countries will look to follow.
This year, our government will introduce new legislation to create a Digital Markets Unit with the responsibility to proactively set competition regulation to stop abuses of market power.
In Europe and in America policy makers are looking keenly at what's happening in Australia before making their own decisions.
We are all in this fight together, and we should stand in support of Scott Morrison and his government, as they take on the power of Big Tech.