In February 2021, an important battle took place in Australia’s cyber universe. On February 18 the country’s 18-million Facebook users woke up to an empty feed, defined in this case as a Facebook profile that had no advertising or news items visible to users.
This blackout formed part of the battle between Australian legislators, the media and technology giants Facebook and Google. The heart of the dispute was the case made by traditional media that Facebook and Google were using the content of media houses without adequately compensating them.
In the view of the media stakeholders, the ability of Facebook and Google to populate their users’ timelines with content generated by media houses was fundamental to the popularity of the sites.
More importantly, as mere conduits of content generated by others, Facebook and Google shouldered none of the legal liabilities associated with news and content production.
In response, Australian regulators proposed a law that would force Facebook and Google to pay for content. In retaliation, both tech giants threatened to cut off Australian users from their platforms.
During the Facebook blackout Facebook’s case was proved, as traffic to news websites dropped 13% during the blackout. The fall reflected the intractable relationship that has developed between content creators and the tech giants. As platforms that have aggregated different items that matter to individuals, the tech giants have become the primary interaction point for consumers looking for information about various items. An individual looking to compare products or find the best location for a product heads to Google first to get the widest range of options.
By understanding one’s social network and preferred engagements, Facebook is able to curate products that speak to the user directly and reduce the time associated with searching for alternative products. Such a turn of events has meant that for many content providers Facebook and Google have become the primary source of traffic and eventual sales.
That argument persuaded the tech giants to believe the content creators needed them more than the other way round, to remain viable. The problem with that assertion is that the relationship was not just a liner referral where Facebook or Google simply redirect a user to the story generated by a journalist. Rather, through the use of sharing mechanisms users could end up getting access to the full content without actually having to redirect themselves to the original content creator.
This had created a wholesale economic crisis for the media industry where its revenues plummeted and were swallowed up by the tech giants, which inherited none of the production costs or associated legal risks. Australia’s move to intervene sought to strike a balance between accessibility and choice provided by the tech platforms; and the viability of the institutions that generate the content.
When Australian lawmakers refused to budge on their commitment to enact the law, Facebook and Google yielded and eventually entered into agreements with content creators. This model has now been the reference point for regulators across the globe seeking to protect traditional media industries from cannibalisation by the tech giants. In Europe, the EU Commission is implementing laws aimed at increasing regulations of all tech giants, alongside the equally important project of taxing them equitably. The UK, which has to do it all on its own thanks to Brexit, is proposing its own version of the Australian law that will alter the relationship between its media and the tech giants.
SA’s Competition Commission has initiated a market inquiry into the sector and plans to produce a report by the end of 2022. Through these developments the reality that has dawned for all stakeholders is that rather than being enemies in the information turf war, the relationship between the tech companies and the media is now an intractable alliance whose stability is the source of financial viability for everyone affected.
• Sithole (@coruscakhaya) is an accountant, academic and activist.
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