Media intelligence brought to you by

Contextualising the Facebook, Google, News Media Bargaining Debacle

News Media Bargaining Code and Facebook, Google

NZ Marketing gets reaction to the Google, Facebook, Australian Government showdown over the News Media Bargaining Code, and asks how something similar may play out in New Zealand.

A little over a week ago Google in Australia reached a new agreement with News Corp which will cover 26 Australian publications for News Showcase and a range of other products. This in the context of that country’s Government’s News Media Bargaining Code.

Going a different route, in response Facebook issued a statement saying that the tech giant would restrict publishers and people in Australia from sharing or viewing Australian and international news content. 

The Facebook statement read: “The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content. It has left us facing a stark choice: attempt to comply with a law that ignores the realities of this relationship, or stop allowing news content on our services in Australia. With a heavy heart, we are choosing the latter.”

Google’s position on the Code is as follows: “We are not against being regulated by a Code and we are willing to pay to support journalism—we are doing that around the world through News Showcase. But several aspects of the current version of this law are just unworkable for the services you use and our business in Australia.”

What followed was an outcry from news publishers in that country on the Facebook ban, and questions about how beneficial a Google-News Corp agreement might be for publishers, journalism and the public.

Given that this has happened so close to home (New Zealand), NZ Marketing thought to ask how similar agreements/ bans may play out in this country – and the likely impact for media and advertisers.

Kris Hadley, Managing Partner at Together shared these thoughts.

How likely is such an agreement in NZ, and how is it likely to benefit publishers?

Google’s News Showcase exists in other markets and there are already +450 partners globally, so it’s seems unlikely it will never come to NZ.

The extent to which it will benefit publishers will be down to the deal each makes, though they won’t have a Bargaining Code as back-up in that negotiation as Australians do. The big picture is anything that increases revenue to reputable publishers has to be – in principle – a good thing, but time will tell on whether revenue gained here is at the expense of advertising dollars. 

How will this impact on publishers need to get advertising? 

It’s hard to imagine that publishers will be significantly less reliant on advertising if they sign up to News Showcase. That’s ultimately going to come down to how many people choose to consume news content within the service versus going direct. In the current climate I imagine all publishers will be hoping it is incremental revenue, not replacing advertising revenue. 

What is your reaction to Facebook’s decision to ban news? 

We don’t agree with Facebook’s decision as it’s the negotiating equivalent of scrambling the nukes, but understand the context of it in the face of what appears to be an unworkable code.

Any legislation that reduces the plurality of perspectives and reach of trusted information sources can’t be good, and can’t be the consequence the government sought. Facebook not carrying credible news content is a lose/lose/lose – consumers lose because they have more fragmented access to good quality, balanced journalism; many publishers lose (especially smaller publishers) because they lose the brand-building and traffic that appearing in the widest reaching social stream gives them; advertisers lose because the quality of Facebook as an advertising context takes a further nose dive, and so ultimately Facebook lose too because advertisers start to question the brand safety of the platform.

While news content might only make up seven percent of the content on Facebook, I’d argue it adds disproportionately to the perceived quality of the overall content proposition for brands. Facebook will be banking on advertising staying put but it’ll be interesting to see who blinks first.

Since the events of last week, Facebook as restored the sharing of news publisher content and The Guardian Australia has joined Google News Showcase. 

Avatar photo

About Bernadette Basagre

Bernadette is a content writer across SCG Business titles, The Register and Idealog. To get in touch with her, email [email protected].

Leave a Reply

Your email address will not be published. Required fields are marked *