Big tech must share profits with traditional media


Lizzie O’Shea

Recently Facebook carried out what may have been the single largest content takedown in its history. Any content that looked vaguely like news, even if it very much was not, disappeared from the platform in Australia.

The company was demonstrating its opposition to a law now passed by the Australian Parliament that could require technology companies to compensate news organisations for their content.

The action was a high-stakes tactic designed to improve Facebook’s bargaining position with Australian lawmakers, and it worked: The company quickly negotiated amendments to the legislation and has now committed to restoring news sharing to the site.

This episode has shown that tech companies will behave in unscrupulous ways to ensure regulations are drafted to suit them. It also demonstrates that government often fails to put the public first when making technology policy.

The Australian law aims to protect the news media by ensuring that digital platforms share the benefit they earn from content posted on their sites with the Australian businesses that produce that material.

“Our news media code is all about levelling the playing field & ensuring digital giants pay news media businesses for generating original content,” Josh Frydenberg, the treasurer of Australia, wrote on Twitter this week.

Big tech opens purse strings

Under the law, companies like Google and Facebook will be encouraged to pay news organisations when links to their content are shared on social media; if the parties cannot agree, they will resolve their dispute through arbitration.

In response, Google first threatened to take its search engine offline in Australia and then struck deals with media companies to avoid the legislation’s compulsory arbitration plan. Following week Facebook negotiated with lawmakers after first following through on its threat to block news content in Australia entirely.

While Facebook’s reversal is welcome, there are real problems with the code, which is why organisations like Digital Rights Watch have opposed the legislation. Public Interest Journalism Initiative has tracked the contraction of nearly 200 newsrooms in Australia since January 2019, with rural areas most affected. This is lamentable at the best of times, but watching the raging fires lurch unpredictably across Australia in 2019 and 2020 highlighted how essential reliable, decentralised media is.

Yet there is no guarantee that revenue generated by the code will address the problem. As we’ve just seen with Facebook and Google, the legislation creates incentives for platforms to negotiate with news organisations to pay for content appearing on their site. But news outlets are not obligated to direct this money toward quality journalism — they are free to spend it however they choose. The government could have taken a tax-and-spend approach to the issue and used the proceeds to fund the media. Instead the code creates a system where money is transferred from one private entity to another, and where Australians are expected to trust that someone like Rupert Murdoch will spend his newly gotten gains on quality public interest journalism.

Not improving journalism quality

In fact the code may not improve the quality of journalism at all. In addition to establishing payments for news content, the code includes provisions that would force platforms to give news organisations access to data about their readers. It will also compel technology companies to notify publishers when they make changes to algorithms that might affect how news content appears in searches and feeds.

Instead of protecting users from the predatory practices of surveillance capitalism, the code actually aligns the interests of tech platforms and media organisations in maintaining the status quo. As a result, media outlets will be better able to optimise their output to attract advertising revenue, which is hardly the kind of journalism we need at this moment. It is also unclear how the code will promote media diversity. It’s structured to favour established players at the expense of smaller outlets. To be eligible to participate in the compulsory arbitration program, a news business must make a certain amount of revenue, and it must create predominantly Australian content for Australian audiences. Some podcasts, newsletters and YouTube channels produced independently might not be eligible to register as “news businesses,” even though they could have larger audiences than some established publications. The law displays a misunderstanding of the political economy of online media, where some internet personalities are as popular, if not more so, than entire mainstream media outlets.

For too long, tech companies have mined our personal experiences to power a data-extractive business model for immense profit, at a great social cost. Public interest journalism needs to be properly funded to hold the powerful to account and facilitate the free flow of information. The code lacks both a technical understanding of the digital media economy and the ambition to remedy the harms that it has produced. The solution is not to lean into the business model of big tech by creating a system to force platforms to share their profits with

traditional media.


Lizzie O’Shea is a lawyer, 

writer, and broadcaster. 

Source: The New York Times