Facebook’s ham-fisted response to paying for news

While Google’s response to plans by the Australian government to force social media giants to pay for news has been nuanced, Facebook’s response has been provocative.

Imgage: MobileAppDaily

Facebook announced last Wednesday that it would block news-sharing on its Australian site.

I suppose Facebook hopes to generate outrage from Australians so that the government will change its mind, but it’s not going to work. The social media titans are facing similar moves by governments around the world, including Canada. Australia is the just the latest battleground. Google has reached deals with publishers in Britain, Germany, France, Brazil and Argentina.

News is vital to a functioning democracy and it must be funded. But How? We pay for news one way or another; either with our attention through advertising or by subscriptions. The news that you receive through CFJC Today and Kamloops This Week is paid by advertisers. The Globe and Mail requires a subscription.

As newspapers folded one by one, one laughable solution to the news drought was an army of “citizen reporters” who blog the news. What we got instead was an army of ill-informed bloggers with bull horns, each shouting louder to be heard over the din.

Print publishers complain that social media giants make money on their news.   Facebook and Google respond that they only post stories that publishers freely distribute and that publishers are the ones who benefit through increased circulation. But postings by publishers are a loss-leader: they hope that readers will be attracted to their sites and eventually subscribe to their news.

You’d think that this would be a win-win situation. Facebook and Google make money from news posted on their sites and publishers reap the benefits of increased exposure.

Facebook argues that that the Australian government is trying to fix a problem that doesn’t exist. Facebook said that the proposed legislation “fundamentally misunderstands” the relationship between itself and publishers, arguing that news outlets voluntarily post their article links on Facebook, which helped Australian publishers earn about $400million in 2020 through referrals.

The trouble is that the traditional business model for news publishers is broken. Paying reporters to dig up relevant news is expensive. Facebook and Google don’t pay for the news and yet get they receive revenues from it.

However, Facebook has a point: they are doing news publishers a favour and if they didn’t post reliable news stories, fake news would fill the vacuum. But their response has been ham-fisted compared to Google’s. Even though their complaint is the same, Google reached a global deal with Rupert Murdoch’s News Corp., owner of The Wall Street Journal and two-thirds of Australia’s major city newspapers, to develop a subscription platform and share advertising revenue.

The difference in approach mirrors the culture of the two social media titans. When Mark Zuckerberg said of Facebook, “Move Fast and Break Things,” it reflected the provocative culture of the company.

Google’s original motto was “Don’t be evil” which later became “Do the right thing.”

Canada is watching as the battle unfolds globally. Canadian Heritage Minister Steven Guilbeault will be introducing legislation that will require Facebook and Google to compensate news publishers. Will the response of be one of retaliation or cooperation?

(NOTE: Since this column was published, Facebook has reached an agreement to pay news publishers)

Ottawa’s plan to force digital giants to pay for news is doomed

image: Search Engine Journal

You might have missed it in the recent Throne Speech but the federal government intends to tax the digital giants Facebook and Google (FG).

The feds are reacting to complaints by newspapers that FG steals their news and profits from it.

That would be a legitimate complaint if newspapers didn’t give their content away in the first place. They do so to attract readers to their sites where readers will be exposed to advertising and hopefully subscribe.

If newspapers didn’t want you to see their product online, they wouldn’t put it there.

The business model for newspapers like the Globe and Mail operates on paid subscriptions and advertising. Obviously, they can’t afford to give away news that subscribers pay for, so they give away content selectively.

That being the case, the owners of the Globe and Mail were being disingenuous when they took out full page ads in May complaining that FG steals their content and makes money from the links.

If the Globe and Mail didn’t want FG to share content, they wouldn’t ask readers to “share this” on Facebook and they wouldn’t optimize their content so as to be found on Google searches.

Newspaper owners can’t promote sharing on FG and then complain when they do.

Globe and Mail columnist Andrew Coyne took issue with the owners of his newspaper:

“Indeed, most of the industry’s traffic these days, millions of readers and billions of page views annually, comes to us from Facebook and Google. Those readers are worth hundreds of millions of dollars to us annually. It would probably cost us a good chunk of that to find and attract them on our own. Facebook and Google send them to us … at no charge (September 19, 2020).”

Not all media are selective in what they share. CFJC Today places columns such as this one (please share it), and news online.

FG’s business model is quite different. They take content that others create and place ads on it. But, again, FG is not stealing content. People happily post pictures of cats and links like to the ludicrous far-right conspiracy theory QAnon which alleges a cabal of Satan-worshiping pedophiles is running a global child sex-trafficking ring and plotting against President Donald Trump.

The speech from the Throne was vague:

“Web giants are taking Canadians’ money while imposing their own priorities. Things must change and will change.”

But Heritage Minister Steven Guilbeault was clear when he said: “the Canadian government stands with our Australian partners and denounces any form of threats.”

Guilbeault was referring to Australia’s proposed law which would force FG to hand money over to media when users click on links to the media source that created the content, a so-called “link tax.”

But Facebook would simply deleting the links to avoid the tax. A Facebook spokesperson said:

 “This is not our first choice – it is our last. But it is the only way to protect against an outcome that defies logic and will hurt, not help, the long-term vibrancy of Australia’s news and media sector.”

Ottawa’s plan to force digital giants to pay for links will backfire. Link taxation will mean that FG will stop sharing the content that legitimate media produce. The news vacuum so created will drive readers to fake news sites.

Is that really what the feds want?