In an epic battle of wills between American Big Tech firms (Facebook and Google) and the Australian government, it looks like the Australian government is coming out on top. After Facebook blocked sharing of Australian media content last week in response to a bill that would have made Big Tech liable for paying producers - aka media companies - for content they produced, it looks like lawmakers have caved, and made several amendments to strip out the offending bits. And now, Facebook is planning to lift the block "in the coming days."
Facebook and Aussie lawmakers have struck a deal to add several amendments that would nullify bits of the proposed Australian law that would have made Big Tech firms - specifically Google and Facebook - responsible for payouts to local media companies, as the FT reports.
The proposed law was supposed to be a model for other governments as the world seeks to combat "disinformation" by forcing Big Tech to pay media companies for the content that is shared across their platforms. In Australia, Google and Facebook have been the two main targets, seeing as that's where the bulk of news is shared.
Here's how Canberra justified its decision to the FT: which explained that the amendments could give Big Tech more "flexibility" to avoid the most "stringent" parts of the law.
Canberra said the amendments to the proposed law would provide clarity for digital platforms and media businesses about how the code would operate. It features an arbitration system that would make binding decisions on the fees designated platforms would have to pay news providers if commercial negotiations failed. The changes could give Facebook and Google, the companies most vulnerable to the code, more flexibility to escape the most stringent aspects of it.
The Australian law sought to promulgate a statutory "code" governing relations between media organizations and major tech platforms, initially limited to Google and Facebook. The code is explicitly designed to ensure that big tech pays its fair share to save local journalism.
But thanks to the changes, authorities would have to consider whether a company had made a significant contribution to the news industry by reaching commercial deals with media businesses. The final arbitration model included in code, which had drawn intense ire from Big Tech, will be stipulated as a “last resort” when commercial deals cannot be reached. A two-month period of mediation must occur prior to arbitration, the government said.
Google notably bowed to the pressure from the Australian government by striking a deal with News Corp., the Rupert Murdoch-controlled publisher, that will govern how Google pays for the content produced by the Murdoch empire.
Facebook, on the other hand, assumed a threatening posture and blocked the sharing content produced by Australian news publishers. Though, to be sure, Google at one point also threatened to pull out of Australia altogether as the negotiations continued.
To be sure, as the FT notes, even if Google's riches were spread more evenly around the media industry, it's unclear whether this will make any difference in the state of the media.