Facebook
And in every one of these battles, Facebook has primarily been on the offensive. Last week, in an act of aggression, Facebook shut down its news service in Australia ahead of upcoming legislation. Google
Eventually, this saber-rattling forced all parties to the negotiating table, and an agreement was reached-for now. But the fact remains that by using heavy-handed tactics, both Google and Facebook were effectively able to rewrite legislation in their favor.
From the start, Facebook claimed the legislation was "unworkable." Under the initial law, Facebook and Google would've had to pay Australian publishers for linking to their content.
In a blog post, Facebook's VP of global affairs, Nick Clegg, claimed that Facebook had been negotiating with Australian MPs for three years. And he said that the news blackout was "legally necessary" once the passage of the law became imminent.
"We neither take nor ask for the content for which we were being asked to pay a potentially exorbitant price," Clegg elaborated. He likened the legislation to "forcing carmakers to fund radio stations because people might listen to them in their car."
Eventually, though, both sides came to an agreement. The legislation was amended so that "fair negotiations are encouraged without the looming threat of heavy-handed and unpredictable arbitration."
The post ends with Clegg describing a third way of sorts. Facebook plans to spend $1 billion over the next three years on partnerships with news organizations. These partner publications will get paid when their stories are featured in the news section of Facebook's app. Google also plans to spend $1 billion on similar partnerships over the next three years.
But such moves are unlikely to deter criticism. Facebook and Google's scorched earth tactics against the Australian government are already prompting publishers in the E.U. to lobby for similar legislation.
"It has become clear that without the full force of an Australian style approach, gatekeeper tech companies threaten to walk away from negotiations or exit markets entirely," Angela Mills Wade, director of the European Publishers Council, told Bloomberg.
It's unknown whether an Australian-style arbitration clause will feature in the E.U.'s upcoming Digital Markets Act. It's also unclear whether Facebook would enforce another news blackout across an entire continent should such a regulation come into force.
It wouldn't be unprecedented. In 2014 Google shut down its news service in Spain after their government passed a law akin to the Australian one.
The question remains: Can tech giants like Facebook effectively set government policy by simply threatening to pull their services? Such questions will only grow in importance as governments worldwide take steps to curb big tech's outsized influence.
- 1.https://www.cnbc.com/2021/02/24/facebook-to-invest-1-billion-in-news-over-next-three-years.html
- 2.https://www.bloomberg.com/news/articles/2021-02-24/facebook-faces-year-of-reckoning-after-showdown-in-australia
- 3.https://about.fb.com/news/2021/02/the-real-story-of-what-happened-with-news-on-facebook-in-australia/
- 4.https://www.theverge.com/2020/6/9/21285656/facebook-news-tab-section-launch-us-local-publishers-partnership
- 5.https://www.bloomberg.com/news/articles/2021-02-19/europe-publishers-turn-up-heat-on-facebook-after-australia-spat
- 6.https://www.bloomberg.com/news/articles/2021-02-11/life-without-google-australia-is-now-facing-the-unthinkable