Indian Publishers Echo Power Imbalance as FB & Aus Clash Over News

Facebook recently blocked news in Australia over the issue of having to pay news companies for sharing their links. 

4 min read
Facebook recently blocked news in Australia over the issue of having to pay news companies for sharing their links. 

Facebook recently ‘unfriended’ Australia over the issue of having to pay news companies for sharing their links, claiming the government’s proposed law ‘misunderstood’ the relationship between the platform and news publishers.

Following the controversy over Facebook banning news on its platform in Australia and strong statements by Prime Minister Scott Morrison, the social media giant said on Tuesday, 23 February, that it will lift the contentious ban on Australian news and pay local media companies for content, after a last-gasp deal on pending landmark legislation.

Australia is almost ready to bring a law that will require the tech giants to strike commercial deals with media companies within 90 days.

According to the government, the law will provide better bargaining power to news companies who've struggled for ad revenues while Google and Facebook line their pockets.

Indian news publishers The Quint spoke with said there is indeed an imbalance in power between the ‘Big Tech’ platforms and the publishers.

The clash between Facebook, Google and the Australian government has drawn global attention as countries including Canada and Britain consider similar steps to rein in the dominant tech platforms and preserve media diversity.

Senior Indian publishing executives told The Quint that publishers have often not been in a position to negotiate as the process of monetisation of content and algorithms of the platforms are opaque. They said any such similar move in India must prioritise saving of newsrooms and quality journalism.

Great Imbalance in Power Between FB, Google & News Publishers

Publishers in India echo the sentiments of the Australian and other governments around the world who are moving to get platforms to pay news companies to restore a balance between the two.

Abhinandan Sekhri, co-founder and CEO, Newslaundry said that as a general trend and as a philosophy in the digital space, there are two facts that few people will challenge.

First, “the few tech giants have become too profitable. They are the most profitable companies in the world ever and have become profitable on the back of news generated by news companies,” Sekhri told The Quint.

“At a philosophical level,” Sekhri added, “it is better for the world to be less profitable and be more reasonably valued to ensure journalism remains important. As a broad argument, I’m completely on board with that.”

Rajiv Verma, former CEO, Hindustan Times Media, said the situation in India is not dissimilar to that in Australia. He explained that legacy media companies have been hurting for some time now and this fall for publishers became precipitous post-COVID.

“It had already started to decline over the last 4-5 years. Therefore, the question is, what is happening in other parts of the world... Why should it not happen in India?” Verma said.

Agreeing that a similar regulatory move could work well in India, Verma added “Therefore, if a resolution is happening in Australia, Europe and if US is going into enquiries into antitrust issues of abuse of monopoly, why should India be different?”

‘Journalism Has to Survive in a Democracy’

Would the developments fundamentally change the relationship between big tech platforms and news publishers?

In its justification behind blocking news, Facebook had stated in its blog that the proposed Australian law “fails to recognise the fundamental nature of the relationship between our platform and publishers.”

In doing so, Facebook had made it clear that it will not let the revenue sharing equations change so easily. And even if the relationship is reset, it will not be reset on the terms set by the government or the publishers.

Would such a situation where Facebook blocks news in India cripple the ability of news platforms in reaching mass audiences online?

“Without them, it may become a little more expensive and difficult in terms of viewer acquisition, but it will not be impossible. But there will be a new way to reach out to consumers. I feel one need not blink,” Sekhri said.

On the question of whether a similar move would be welcome in India, Verma said, “I do hope we will, because saving journalism is more important for India. India is a democracy and saving journalism for the sake of democracy is in complete societal and public interest.”

Adding that the news business can’t be allowed to become unviable, Verma added, “It is imperative that journalism is saved. You and I don't want to live in a world where quality journalism doesn't happen.”

“This can’t happen until there is fair and equitable sharing of resources between platforms who enjoy certain dominant positions compared to journalism in newsrooms.”
Rajiv Verma, Former CEO, HT Media

Who Benefits More in Big Tech-News Publisher Partnership?

Zuckerberg & Co have emphasised that it brings much more value for news outlets than they do for Facebook. The platform said it sent more than 5 billion clicks to Australian publishers, whose value he estimated at AU$ 407 million.

Facebook estimates that only about 4 percent of posts on the network is news content. Google also said news-related queries accounted for just over 1 percent of the total queries in Australia.

Verma acknowledges it is undeniable that technology has helped news reach a larger audience. “Equally, what cannot be denied,” he says, “is that the discovery of this audience, once it becomes available, the financial benefit of that because of the way business models have transformed, have all gone to the platforms.”

According to him, once the discovery of audience happens, a large amount of data is captured.

“Algorithms are opaque and how that gets monetised, publishers are not in a position to negotiate. That's why regulators have stepped in and tried to balance the power play so that a proper sharing of revenue can take place,” Verma further added.

Sekhri said he sees the battle between large tech platforms and news companies as an existential battle and not simply a fight over revenue sharing.

“When pushed to the wall, one is fighting for survival and not just a larger piece of the pie. There is a possibility of backing down when two parties are negotiating for a larger piece of the pie, but if one of the parties is fighting for survival then it’s inevitable the gloves are going to come off at some stage.”
Abhinandan Sekhri, Co-founder & CEO, Newslaundry

(The Quint is available on Telegram. For handpicked stories every day, subscribe to us on Telegram)

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