Facebook on Wednesday blocked people in Australia from posting news stories on its website, a drastic escalation in the battle over whether tech giants should pay publishers when their stories show up in search results or on social media.
Google took the opposite approach. The company struck deals in recent days with Australia’s major publishing companies, including on Wednesday with Rupert Murdoch’s News Corp, to pay for some of their news content. The deal came in exchange for avoiding the most stringent parts of a new law in Australia, walking back its own threat from last month to shut down its search engine in the country.
The Facebook ban blocks posts from any Australian publisher from being seen anywhere in the world, and blocks all users in Australia from seeing any news content, even from non-Australian publishers. The move apparently caught up some government websites that posted information about emergencies, fires and weather.
The reaction in Australia was severe. “Facebook needs to think very carefully about what this means for its reputation and standing,” Australian Communications Minister Paul Fletcher told the country’s public broadcaster. “They’re effectively saying ‘on our platform there will not be any information from organizations that employ paid journalists.'”
Facebook had less to lose than Google — which had threatened to completely shut down its search engine in the country— by escalating the fight further, Johan Lidberg, a media professor at Monash University in Melbourne, said in an email.
“Google also appears to be more in tune with what the community wants and seems to take social responsibility somewhat more seriously than Facebook,” he said. “There will now appear a void where professional credible journalism used to be on Facebook and this void could be populated with misinformation and conspiracy theorists.”
Google’s deal with News Corp is part of its News Showcase product, which lets publishers choose which of their stories are promoted on special sections of Google’s apps and search pages. But the arrangements fall short of applying to news stories catalogued by Google and linked to in regular search results, the most popular way people currently come to news stories online — and something the proposed law would have required if Google didn’t strike the deals.
Stories from the Wall Street Journal, the New York Post, the Sunday Times and other News Corp publications from the United Kingdom and Australia will show up in special panels on the Google News app, on the search home screen on mobile phones and on Google News on desktop computers. The deal does not include Fox News, Google spokeswoman Maggie Shiels said. It covers a limited number of countries, including Australia, the U.K., France and Germany. The companies are in discussions to expand the program to the United States, Shiels said.
Google has struck similar deals with Reuters and regional news companies in the countries where it’s operational, including with another major Australian publisher on Sunday. The companies won’t say how much the deals are worth, but Google has set aside $1 billion for such deals worldwide over the next three years.
Google is the latest tech giant to come around to the idea of beginning to pay for some news. Apple strikes deals with publishers who participate in its Apple News Plus service. Facebook also pays certain publishers for posting stories on its dedicated Facebook News tab, which isn’t available in Australia.
Facebook had threatened to block news from its site if the government went ahead with the new law, but the negotiations about the details in the bill are still ongoing, with the government making some tweaks last weekend. Those were not enough to placate Facebook.
The legislation “seeks to penalize Facebook for content it didn’t take or ask for,” William Easton, Facebook’s Managing Director in Australia & New Zealand, said in a blog post. Unlike Google, which scrapes news sites and puts links to stories in search results, publishers willingly choose to post news on Facebook to win traffic, Easton said.
“We were prepared to launch Facebook News in Australia and significantly increase our investments with local publishers, however, we were only prepared to do this with the right rules in place,” Easton, the Facebook executive, said. “We will now prioritize investments to other countries.”
Google’s deal with News Corp was especially notable given how the news publisher has lobbied against the tech giant in recent years. In the United States, it has pushed state and federal regulators to make changes in the digital advertising industry, which Google dominates and which is a key source of revenue for both companies. Google has raised concerns about a former News Corp consultant helping advise Texas on its antitrust lawsuit against the search giant.
News Corp is Australia’s biggest newspaper publisher and has been a driving force in lobbying for the new legislation. In a news release, News Corp called the deal a “historic” success that would lead to “significant” payments to the company.
“For many years, we were accused of tilting at tech windmills,” said News Corp CEO Robert Thomson. “But what was a solitary campaign, a quixotic quest, has become a movement, and both journalism and society will be enhanced.”
Despite making the publisher deals, Google said it is still officially opposed to the law, which passed in Australia’s House and moved onto the Senate on Wednesday.
The biggest sticking point for Google is that the new law would apply to links to news articles in general search results. Throughout its two-decade history, the company has steadfastly refused to pay the websites it links to, saying that it must be an impartial librarian of the Internet and that the concept of a free and open Web would break down if it was forced to start paying.
“The law would unfairly require unknown payments for simply showing links to news businesses, while giving, to a favored few, special previews of search ranking,” Kent Walker, Google’s top global policy executive, said in a Feb. 11 blog post. “Those aren’t workable solutions and would fundamentally change the Internet.”
News Showcase is Google’s attempt to sidestep that problem, by creating a separate product that looks and feels different from search results. It’s part of a broader trend at Google of moving away from traditional blue links and adding more curated content, some of it paid for, in search results.
Google’s deals with news publishers show the law is working, even before it’s officially been enacted, Josh Frydenberg, Australia’s treasurer and a senior member of the government’s cabinet, told reporters Wednesday. “None of these deals would be happening if we didn’t have the legislation before the Parliament,” Frydenberg said. ” . . . This world-leading mandatory code is bringing the parties to the table and is helping to pave a way forward where news media businesses are getting paid for generating original journalistic content.”
Hours later, Facebook announced its ban on news sharing.
“This morning, I had a constructive discussion with Mark Zuckerberg from #Facebook,” Frydenberg said on Twitter. “He raised a few remaining issues with the Government’s news media bargaining code and we agreed to continue our conversation to try to find a pathway forward.”