Australia: Facebook unfriends, then refriends, a nation
Australia has tamed Big Tech, said The Australian in an editorial. After the lower house of Parliament passed legislation last week that will force digital companies “to pay for news content they currently take for free,” Facebook threw a tantrum. While Google grudgingly began striking deals with big Australian media firms, Mark Zuckerberg’s company called the legislation “unworkable” and barred users in Australia from sharing or viewing content from any news outlet (see Technology, p. 22). Facebook’s faulty algorithm also blocked government and charity pages that provide information on everything from bushfire mitigation to domestic violence advice, and even blacked out the accounts of state health agencies on the eve of our coronavirus vaccine rollout. This sweeping shutdown sparked bipartisan outrage in Australia and across the West, and so—after our conservative government made some minor changes to the legislation—Facebook this week “refriended Australia,” restored the blocked news content, and began negotiating deals with major media companies. Zuckerberg thought his company was more powerful than any government, and “overplayed his hand in Australia.” The pushback on Big Tech, started Down Under, “could open a new era of competitive digital innovation that will benefit everyone.”
Not everyone, said Lisa Visentin in The Sydney Morning Herald. Small newspapers and publishers—hollowed out by Google and Facebook vacuuming up advertising dollars—don’t have the money or lawyers needed to negotiate deals with Silicon Valley titans, and nothing in the legislation guarantees them a rightful slice of online revenue. That’s unsurprising when you realize the driving force behind the legislation is Rupert Murdoch, the Australian media mogul whose News Corp firm owns five of Australia’s biggest papers, as well as its top online news site and the TV network Sky News Australia. Changing our tax code might be a better way to fix the digital news market, said Osman Faruqi, also in the Herald. Facebook made $530 million from Australian advertisers in 2019, on which it paid only 2.5 percent tax, while Google made $3.4 billion and paid a paltry 1.4 percent. A “turnover tax”— such as the one being considered by the European Union—would require the tech companies to “pay their fair share,” and the government could then use those revenues to support local journalism.
Facebook’s climbdown might seem like an “unvarnished victory for democracy,” said Chris Stokel-Walker in INews.co.uk.
“It isn’t.” Zuckerberg caved in Australia—whose 17 million Facebook users “represent literally a fraction of a percent of his entire userbase”—to preserve Facebook’s already damaged reputation for coming fights in more important markets. His firm is facing antitrust hearings in the U.S. and new regulation in Europe, and will soon be subject to online anti-harm laws in the U.K. that will slap fines on platforms that allow hate and disinformation to spread. “This wasn’t Big Tech being brought to heel: This was Big Tech realizing it needs to keep its powder dry for the bigger battle ahead.”