Mark Zuckerberg, has announced that Meta (which includes Facebook and Instagram) will no longer pay Australian publishers for news. He plans to withdraw from Australia’s News Media Bargaining Code when agreements with news publishers come up for renewal in the second half of 2024.

Under the 2021 code, Google and Facebook pay an agreed fee for displaying news content on their platforms through commercial agreements with participating news organisations.

While the code is mandatory, it has not been enforced because both Google and Meta were able to make individual voluntary deals with publishers.

Google has not flagged its commitment to new agreements.

What are the government’s options?

Responding to Zuckerberg’s announcement the Minister for Communications, Michelle Rowland, said:

The decision represents a dereliction of its commitment to the sustainability of Australian news media. Australian news publishers deserve fair compensation for the content they provide.

Seeking advice from Treasury and the ACCC, the Government has said it will work through all available legislative options and continue to engage with news publishers and platforms.

Is designation the way forward?

The main option available to the government under the legislation is to “designate” Meta, thus forcing it to negotiate with media companies to pay for content. Some media executives have supported that approach.

But be careful what you wish for. In response, Meta could decide to withdraw all Australian news from its sites, as it did in Canada. With no news from reputable Australian journalists, Facebook could become the home of misinformation. And those people who view news “incidentally” via Facebook will no longer do so.

A new approach?

Many have argued that the code was a flawed response to a bigger problem – the loss of advertising revenues for media organisations as news went online. Social media incentivised clickbait and the code unfairly excluded some news organisations like SBS.

James Purtill from the ABC has argued that “putting the boot” into Meta by enforcing the code would make a bad situation worse and won't solve the underlying problem of who will pay for the news.

Peter Greste said:

One of the big problems with the code was that it pushed media companies into inherently unstable and unpredictable deals with commercial behemoths, whose only interest in news was as a commodity to help drive profits. It was always going to fall apart, if and when news became too expensive and Facebook users became disinterested.

Greste called for the government to impose a news levy – but an additional tax is unlikely to gain favour with any government. Another option would be to establish a separate fund to allocate grants for innovative, quality journalism, which would be funded by a tax levied on digital platforms.

What does it mean for the ABC?

The ABC reached voluntary agreements with Google and Facebook in May 2021. It used the money to fund an extra 60 journalists in regional Australia.

If one or both agreements were to cease, the ABC would lose an important source of revenue. More jobs would be lost and there would be a further diminution in the ABC’s offerings.

But the code could never be more than a short term fix for a much deeper problem. For years the ABC’s funding was slashed – and we’ve seen the results. There’s no way that a commercial deal with Facebook and Google could compensate for that lost revenue – and arguably it shouldn’t.

As a public media organisation the ABC should be properly funded by government to do its job.

It’s not only news programming that’s suffered from ABC funding cuts. There’s been a dramatic decline in the production of original content.

Please sign our petition calling on the Albanese government to fully fund the ABC and support Australian culture.

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What is the news bargaining code?

The Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Act 2021 is a mandatory code of conduct which governs commercial relationships between Australian news businesses and “designated” digital platforms that benefit from a significant bargaining power imbalance.

The code aims to address bargaining power imbalances to ensure that Australian news businesses receive fair remuneration from digital platforms for the value generated from news content. Under the code – the first of its kind in the world – Google and Facebook remunerate specified news businesses in exchange for displaying news content on their platforms.

The code only creates statutory obligations for digital platforms that the Minister has designated as designated digital platform corporations (DDPCs). To date, no Ministerial designations have been made, but it is an option if Meta or Google refuse to participate in voluntary agreements.

For a news media business to participate in the code, it must be registered by the Australian Communications and Media Authority (ACMA). In March 2024, there were 41 registered news media corporations (RNMCs).

If the parties are unable to reach agreement about the level of remuneration, the ACCC may commence arbitration.