Facebook and Google’s War Against News Publishers

image credit: Insider

published by Chand Bellur
February 24, 2021 at 5:49 p.m.

 

  • Australian lawmakers recently passed legislation forcing Facebook and Google to pay publishers for content.
  • Both Facebook and Google reacted by limiting services or threatening to shut down entirely in Australia.
  • Deals between the tech giants and publishers resolved the conflict; however, the issue of using content for profit without adequate compensation remains.

Facebook and Google Battle Australian Lawmakers Over News Publisher Compensation

People use Facebook and Google to view content. While much of this content is user-generated, a fair portion is created by hard-working writers, just like me. Although both corporations offer some compensation from advertising, all too often, the earnings are meager. 

Appledystopia moved from Google’s Adsense to Ezoic’s publishing platform precisely because the former’s ad revenues were ridiculously low. Adding insult to injury, both Google and Facebook profit from professional journalistic content that’s more compelling than social media narcissism.

Australian lawmakers recently passed final legislation forcing Facebook and Google to compensate news publishers for their content. The law forces both corporations to work out deals with publishers or face arbitration. Facebook removed news content from Australian users in protest of the new law. Australian lawmakers buckled, allowing the Menlo Park social media giant more time to negotiate deals before arbitration.

Major players such as News Corp continued to lose revenues as Facebook and Google profited from its content. Due mainly to Australian lawmakers’ pressure, Google eventually relented and signed a multi-million dollar deal with News Corp to license its content. The company has yet to reach out to smaller publishers, including Appledystopia’s parent corporation.

Do Facebook and Google Help Publishers?

Without a doubt, Facebook and Google help publishers in numerous ways. Research for this article, and many more, is often conducted on Google News. Publications like The Wall Street Journal and The Washington Post enjoy broader audiences thanks to Facebook and Google. Even National Public Radio has a considerable presence on Google News.

There’s a symbiosis between Big Tech and news publishers. Without news, Google and Facebook have little compelling content. In this bleak scenario, users would bookmark some URL in a browser or use a dedicated app to reach a news publication funded by subscriptions. As it stands, some of the most prominent publications hide behind paywalls, as advertising proves insufficient to grow revenues.

Both Google and Facebook need news publishers. News publishers thrived until digital media’s evolution, with the old format struggling to stay relevant. In a sort of market disruption, technology giants can use the news media to a greater advantage than its originators. The current legal atmosphere is an attempt to reach equilibrium.

Google and Facebook Could Create News

As it stands, for-profit corporations dominate the news business. Public broadcasting and a handful of other independent news sources consistently rank as most reputable. These more reliable sources are losing ground to biased cable news networks and polemical Internet sources.

The demise of traditional corporate news sources, such as our nation’s most popular and long-standing newspapers, creates a vacuum that the disingenuous may fill. Google and Facebook could occupy this space with news of their own creation or exploit fringe political interests for profit. In either event, the demise of traditional newspapers could further political division and civil unrest.

Share More Ad Revenues With Publishers

Google and Facebook can easily compensate news publishers by offering ad revenues for content publishers can’t monetize. Both Facebook and Google benefit from the snippets, summaries, and information displays scraped from news publishers. Both tech giants track click-throughs on these items, making it much easier to share the wealth.

For example, Google search results feature small to medium-sized snippets of content. In many cases, users don’t click through to the original content because the summary suffices. Google profits from this content. It’s entirely possible to calculate and share the wealth with publishers. This would benefit small and large publishers alike.

Currently, the process seems to be quite the opposite. The largest corporations, such as News Corp, can negotiate multi-million dollar content deals with Google. Smaller publishers can have their content harvested and used, without compensation.

Future Uncertain for Publishers and Big Tech

Google and Facebook had a motive to play hardball in Australia. Both companies want to prevent legislation forcing compensation for news publishers. In this case, it only bought some time. Both Google and Facebook are negotiating with Australian news publishers to avoid arbitration.

A past ruling clarifies that if the content is merely a pointer to original content, it’s allowed. Since this decision in 2007, both Google and Facebook have expanded their use of third-party news content. What were once small thumbnails and blurbs are now embedded information. In many cases, users don’t click through to the original content because the summary fulfills their needs.

The data are core to any decision on this matter. As search results and social media news feeds become richer and mirror more original content, lawmakers seem more willing to take action against Big Tech.

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