Facebook (NASDAQ: FB) made a polemic after it blocked all Australian news content. The social media giant restricted sharing any news content from Australia anywhere in the world, counter-attacking the Australian lawmakers proposition of “Mandatory Bargaining Code”.
The mandatory bargaining code that Australia intended to apply, required tech giants like Facebook and Google to pay media publishers in return for sharing their news content on the social media platform and search engines.
However, Facebook denied the request and blocked all news coming from the country. On the other hand, Google settled for a negotiation with Australian publishers including Nine Entertainment and Seven West Media conglomerate and Rupert Murdoch’s News Corp.
The move by Australian lawmakers intended to limit Facebook and Google’s capacity over its digital advertising. Lawmakers argued that news publishers revenues declined dramatically due to the tech giants’ power.
Australian News publishers vs Google & Facebook
In recent years, news publishers alleged Google and Facebook for depriving them of any revenues. Furthermore, they alleged the tech giants of taking control over publishing using algorithms and making huge profits on behalf of news publishers.
Consequently, Facebook launched its Facebook’s Journalism Project, while Google responded with Google’s News Initiative. Nevertheless, the moves were described as desperate with no impact on the news publishing industry.
As a result, Australian lawmakers proposed a law that would be fair for Facebook, Google, and news publishers alike. Additionally, the law forces the tech giants of announcing algorithms changes 28 days ahead of the application. The law obliges Facebook and Google to negotiate prices with news publishers within a three months period, or else, the government will interfere to negotiate on behalf of them.
However, Facebook said in a blog post that the Australian lawmaker’s proposed law “fundamentally misunderstands” its relationship with publishers. The company argued that news content brought Australian publishers in 2020 around $315 million.
In conclusion, Google didn’t accept the law at first. The search engine giant allegedly hid Australian news sites from search results in response to the proposed law in January. Nevertheless, Google said that it is now negotiating with Australian media companies to reach an agreement.