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Written on 8 Mar 2021 by Sam Gilbert

Facebook, Australia’s Media Bargaining Law, and Political Moralizing

All too often people take the other side of a dispute with Facebook, deeming it to be "bad". But as in the recent case with the Australian media, it's important to look beyond the reflexive moral outrage that the tech giant may cause and see the real political story, says Affiliated Researcher Sam Gilbert.

The recent controversy over Australia’s Media Bargaining Law is a perfect example of the dangers of political moralizing. Since 2016 – the year that brought us Brexit and the Trump presidency – most commentators have taken the view that Facebook is “bad”, and whatever side of a dispute Facebook is on must be the wrong one. Through this frame, Facebook’s decision to temporarily remove Australian news content and prevent Australian users from posting links to news websites could only be understood as an example of the company’s excessive power and anti-democratic tendencies.

The trouble with this moral outrage was that it obscured what was really going on. Facebook isn’t responsible for the collapse in newspaper advertising revenues – the decline began long before Facebook’s ascendancy with the advent of the web. If anyone killed newspapers’ business model, it was Tim Berners-Lee.

During this period of painful structural change, Facebook has been a boon for traditional media companies, providing billions of clicks for free. Australia’s Media Bargaining Law effectively asks Facebook to pay Australian media companies for the privilege of sending them those clicks.

The law has been described as a “link tax” but even that is misleading. The word “tax” implies that the revenue raised would go to the Australian government, which could use it in ways that are in the public interest – for example, to subsidise local papers, invest in media start-ups, or fund high-quality reporting. But that isn’t what the Media Bargaining Law does: instead, it transfers money from Facebook and Google to large incumbent media companies – in particular News Corp, which controls 65% of the Australian media market.   

To fully appreciate the absurdity of the situation, we might imagine a small town. Mark runs a popular shopping centre; Rupert is a shoemaker. Mark offers Rupert a unit in the shopping centre, for free; Rupert uses it to promote his shoes. One day, Rupert complains to the mayor, Scott, that he can’t bargain with Mark effectively. Scott has his own reasons for wanting to placate Rupert, so he decides Mark should pay Rupert to use the unit he is providing for free. Feeling it’s a shakedown, Mark asks Rupert to vacate the unit instead. As news of Mark’s actions ripples out to the surrounding towns and cities, almost no one is on his side. Despite patronizing them for many years, many people have decided that Mark’s shopping centres are tacky, and that they’ve changed the character of the town in ways they no longer like. Others simply think Mark needs to be taken down a peg or two. In this way, the story of Mark “banning shoes” becomes a vehicle for other grievances.

Surely it would be hard not to feel some sympathy for this imaginary Mark?

But instead of focusing on Mark (Zuckerberg), commentators would have done well to examine the role played in the controversy by Rupert (Murdoch) and Scott (Morrison), Australia’s Prime Minister. By December 2020, some 500,000 Australians had signed a petition calling for a Royal Commission into News Corp – including former Prime Ministers Kevin Rudd and Malcolm Turnbull. The petition highlights Murdoch’s dominance of Australian media, arguing that it undermines free speech and public debate. It accuses Murdoch’s organization of de-funding local news, systematically attacking the ABC (Australia’s equivalent of the BBC), and threatening Australia’s democratic future. That Morrison does not support it says something about his reliance on a good relationship with Murdoch for success at the ballot box. Turnbull, a member of Morrison’s own Liberal Party, has accused him of “operating like a team” with News Corp.

Reflexive moral outrage at Facebook meant losing sight of this complicated political reality. Facebook gets a lot of things wrong, but pushing back against the Media Bargaining Law wasn’t one of them.

  • About the author

    Sam Gilbert, Affiliated Researcher

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    Sam Gilbert