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Facebook rebuffs call to share ad revenue with publishers

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Facebook has flatly rejected a code of conduct developed by the Australian Competition and Consumer Commission (ACCC), which would require internet companies to pay original news publishers for the content from which those platforms subsequently benefit.

In April, the Australian government asked the ACCC to develop a code of conduct which would address the “power imbalances” between news publishers and companies like Google and Facebook with large internet platforms regarding the share of digital advertising revenue. The government has expressed interest in forcing tech companies to pay news publishers for the content shared on their platforms.

Unsurprisingly, Facebook has rejected these proposals. The company stated in a submission to the ACCC that there is already a “healthy, competitive rivalry” between tech companies and news publisher and argued that it already invests in Australia’s media sector.

In response to suggestion from the ACCC that Google and Facebook could be forced to contribute to publishers in response to a “collective boycott”, Facebook said that it would survive without news on its main platform. News, Facebook said, represents a “very small fraction” of the content of the average user’s news feed.

“We made a change to our News Feed ranking algorithm in January 2018 to prioritise content from friends and family,” Facebook said in its submission. “These changes had the effect of reducing audience exposure to public content from all pages, including news.”

“Notwithstanding this reduction in news content on our services, the past two years have seen an increase in people engaging on our services and increased revenues, suggesting both that news content is highly substitutable with other content for our users and that news does not drive significant long-term commercial value for our business.”

Facebook argued that it has been unfairly targeted by the ACCC code, which could allow “rivals from countries that propagate different and undesirable visions for the internet” to get ahead. It also stated that it already invests in the Australian media sector and suggested an “Australian Digital New Council” to manage the relationship between the tech and media sectors.

Last week, Google also rejected the ACCC code, claiming that it makes barely AUD$10m annually from news-related advertising.

Although there have long been concerns that tech companies benefit from news content without any contribution to publishers, the ACCC review was initiated as the coronavirus pandemic has led to a fall in ad revenue for publishers, despite surging interesting in online news, due to promotions being blocked from appearing beside coronavirus-related content. Falling ad revenue has prompted widespread layoffs in the media industry.

A final ACCC code will be presented before the end of July.

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