Facebook last month shut off the ability for Australian users and media organizations to share news links in the country, and now it seems the company’s extraordinary measure has resulted in a compromise for the most interested parties as media giant News Corp has struck a licensing deal with the social network.
Financial terms were not disclosed, but the deal is a multi-year one that gives Facebook’s news platform access to major News Corp Australia properties, including news.com.au, The Daily Telegraph, and Sky News. Google similarly struck a deal with News Corp last month, as the threat of a new Australia law regulating tech company payments to news organizations loomed overhead.
Facebook’s news shutdown in Australia wasn’t designed specifically to increase pressure on News Corp. Instead, Facebook wanted concessions from the Australian government about the then-forthcoming media bargaining law, which stipulated that major tech platforms like Facebook and Google would need to pay news publishers to access their content. Google also threatened to shut down its search engine in Australia, but it ended up striking its own deals instead.
In a predictable turn of events, Facebook received its desired concessions, the largest of which involved negating the forced arbitration portion of the bill that Silicon Valley reviled if prior commercial agreements were struck, and the company restored the ability to share news. Australia then passed the law and everyone more or less came out unscathed. Yet part of Facebook’s initial opposition to the law was that it gave the most powerful publishers too much negotiating power, and News Corp is far and away the largest and most pervasive media conglomerate in Australia.
“Facebook would have been forced to pay potentially unlimited amounts of money to multi-national media conglomerates under an arbitration system that deliberately misdescribes the relationship between publishers and Facebook — without even so much as a guarantee that it is used to pay for journalism, let alone support smaller publishers,” Nick Clegg, Facebook’s global policy chief, argued at the time in a public blog post.
Following the Australia showdown, Facebook said it would commit $1 billion to news industry deals over the next three years to foster partnerships with media organizations, with the unspoken stipulation that it not have to face another media bargaining law like Australia’s. (Facebook said it reserves the right to shut down news in Australia again if it so chooses.)
It appears Facebook and News Corp have made up, and this new deal will make News Corp-owned publishers accessible on the Facebook News platform in Australia. In addition to news.com.au and Sky News, the latter of which has a separate deal as a broadcast organization, News Corp says it’s also licensing content from major newspapers like The Daily Telegraph, Herald Sun in Victoria, and The Courier-Mail, as well as numerous regional publishers.
“The agreement with Facebook is a landmark in transforming the terms of trade for journalism, and will have a material and meaningful impact on our Australian news businesses,” said News Corp CEO Robert Thomson in a statement. “Rupert and Lachlan Murdoch led a global debate while others in our industry were silent or supine as digital dysfunctionality threatened to turn journalism into a mendicant order.”
“We’re glad to have this deal in place and look forward to bringing Facebook News to Australia,” wrote Faceboo’s global news partnerships chief Campbell Brown. Andrew Hunter, Facebook’s head of news partnerships for Australia and New Zeland, said in a statement that “the agreements with News Corp Australia and Sky News Australia mean that people on Facebook will gain access to premium news articles and breaking news video from News Corp’s network of national, metropolitan, rural and suburban newsrooms.”
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