Facebook has announced that it will ban users in Australia from sharing news content, a move that comes in response to media regulation laws proposed by the Australian government.
鈥淎ssuming this draft code becomes law, we will reluctantly stop allowing publishers and people in Australia from sharing local and international news on Facebook and Instagram,鈥� said Will Easton, managing director of Facebook Australia and New Zealand, .
The Australian Competition and Consumer Commission (ACCC),聽a government agency that regulates business practices,聽proposed a draft of new rules in late July that would enable Australian news organisations to ask for remuneration from companies such as and for news shared on their platforms.
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It is the first regulatory legislation of its kind in the world, and may be a test case for potential to follow.
鈥淔acebook could well afford to pay for news in Australia but they may not be able to afford to pay for news globally,鈥� says James Meese at RMIT University in Melbourne.
The law is aimed at redressing what sees as a 鈥渟ignificant bargaining power imbalance between Australian news media businesses and Google and Facebook鈥�.
A decline in advertising revenue across the global news industry has been accelerated by , and more than 50 Australian news outlets have been shuttered since the beginning of the pandemic.
In a , the ACCC鈥檚 Rod Sims criticised Facebook鈥檚 threat of a news ban as 鈥渋ll-timed and misconceived鈥�, while Australian treasurer Josh Frydenberg that the government 鈥渨on鈥檛 be bullied, no matter how big the international company is鈥�.
Google has also responded to the proposed legislation, saying to Australian users in an that it would lead to 鈥渄ramatically worse鈥� search and YouTube services.
If the legislation is passed, there is a significant risk that Facebook and Google will cease to provide news services in Australia, says Rob Nicholls at the University of New South Wales in Sydney.
Facebook鈥檚 decision has troubling consequences for news media in Australia, a country in which of people use the platform as a source of general news 鈥� a figure that is even higher for younger audiences. Without trustworthy news on Facebook, misinformation may spread more rampantly in the absence of fact-checking from reliable sources.
鈥淚t鈥檚 a common play by platforms, when they鈥檙e faced with regulation that they don鈥檛 like, to basically withdraw their services from a particular market,鈥� says Meese.
In 2014, Google withdrew its Google News service from Spain after legislation was introduced to make aggregators pay news publishers for snippets of their content.
Negotiations between Google and news publishers are ongoing in France, which last year passed an EU copyright directive into law that mandates similar payments.
The UK and Canadian governments are eyeing proposals similar to the Australian law, which focuses on fair competition by forcing tech companies to share ad revenue with news outlets, unlike the European regulations, which are grounded in copyright laws.
Because of the symbiotic relationship between news media and online platforms, Google and Facebook may also lose out by withdrawing news services from Australia.
鈥淭he quasi-monopoly position that they鈥檙e currently in could be threatened by their own exit,鈥� says Nicholls.
The removal of news content may drive audiences to other aggregators, free public broadcasters such as the Australian Broadcasting Corporation or to paid subscriptions, which are on the rise. But worryingly, it may also result in a less-informed public.
