News Corp (ASX: NWS) has struck a 3 year content deal with Facebook, for the use of its articles from all its major publications, including notably The Australian, Sky News, Daily Telegraph and The Sun. Whilst Nine News didn’t confirm the deal, they have reportedly signed a letter of intent for the use of its content, which notably was first reported by its own publications including the Sydney Morning Herald and The Age. This comes after Facebook has already secured a deal with Seven West Media.
These deals allows the tech giant to avoid the regulations of the government’s new media laws which would require them to pay for any Australian news content that appeared on their apps and search results, proving to be a win for both sides as government regulation is avoided and local journalism is paid for their content being used.
News Corp Chief Executive, Robert Thomson was evidently quite pleased with the deal, stating
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.
He also went on to credit Facebook CEO Mark Zuckerberg for his cooperation in helping shape a future for journalism, and also thanked Prime Minister Scott Morrison, Treasurer Josh Frydenberg, and the competition watchdog ACCC for their role in facilitating debate which ultimately led to the agreement.
This all comes in the context of Australia’s unprecedented battle with the social media giants, leading the world in taking on big techs power and seeking to claim back some agency for its local corporations, as argued by Morrison’s government.
These agreements are sure to be tracked by CEO’s of major news companies and governments around the world, as a precedent is set on how to tackle the issue of Facebook’s power, and the claim on one side that they free ride off the hard work of local journalists around the globe.
These deals were expected to be reached sooner or later, as Facebook reversed course from its highly controversial move to block all access to journalist and media content to all Australian Facebook users. This was seen by many as a totalitarian move performed to outmanoeuvre and dominate a sovereign country, in which the concept in itself was a scary thought that companies can hold that power.
However Morrison indicated he would rather see big tech and Australian media companies sort it privately and come to a deal to avoid these regulations, and was only intervening as these deals did not look like being reached.
However, those in support of the tech giants argue that Facebook mostly provides a teaser for these articles in which users still have to pay the media corporations money to subscribe to be able to view these articles, and hence in a sense was already doing a good job in providing free advertising for these news companies. It is argued by some that, in effect, Facebook will now be paying the publishers, to advertise content for the publishers, which is unfair. In any case, these debates will continue around the world and developments like this keep bringing it to the spotlight.
This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)
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