May 14, 2021

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Facebook agrees deal with Rupert Murdoch’s News Corp for news content in Australia

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Facebook has signed a multi-year deal with Rupert Murdoch’s News Corp for its journalism in Australia, three weeks after the country passed a world-first law forcing tech platforms to pay for news content.

Google struck a similar deal with the company last month, entitling it to “significant payments” in return for digital, audio and video journalism hosted across Google’s platforms.

News Corp owns around 70 per cent of newspapers in the country, including The Herald Sun and The Australian, alongside Sky News Australia (which reached its own separate deal with Facebook) and popular news site news.com.au, reaching millions of Australians each day.

Robert Thomson, chief executive of News Corp, said the deal was a “landmark” in transforming the terms of trade for journalism and thanked the Australian government for “taking a principled stand for publishers”.

“Rupert and Lachlan Murdoch led a global debate while others in our industry were silent or supine as digital dysfunctionality threatened to turn journalism into a mendicant order,” he added.

Facebook blocked users in Australia from sharing, reading or posting news links on the platform last month in protest at the controversial media bargaining code requiring tech giants to make payments to news publishers.

The social network reversed its decision several days later after the Australian government agreed to make a number of concessions to the code, the most significant of which involved negating its plans to force tech companies into arbitration with publishers to dictate how much they would pay.

Instead, the likes of Facebook and Google will choose the commercial deals they wish to pursue, leaving arbitration as a last resort when agreements cannot be reached.

The UK, Canada, India and France were among the countries to express admiration and support for Australia’s code, Australian Prime Minister Scott Morrison said prior to Facebook’s decision to restore news to its platform, adding there was a “lot of world interest”.

Andrew Hunter, Facebook’s head of news partnerships for Australia and New Zeland, said the agreements with News Corp Australia and Sky News Australia “mean that people on Facebook will gain access to premium news articles and breaking news video from News Corp’s network of national, metropolitan, rural and suburban newsrooms.”

While the value of the deals Facebook and Google struck with News Corp have not been made public, Rod Sims, Australia’s competition regulator, told the Financial Times that both agreements were likely to generate more than A$100m ($77m) a year to journalism in the country, calling the deals “testament to the success of the legislation”.

Part of the amendments made to the media bargaining code when the Australian government negotiated with Facebook centred around whether a digital platform had made a “significant contribution to the sustainability of the Australian news industry through reaching commercial agreements with news media businesses”.

Nick Clegg, Facebook’s global policy chief and former leader of the Liberal Democrats, said the company planned to invest an additional US$1bn into the news industry over the next three years as an indication of its commitment to journalism.

“Facebook is more than willing to partner with news publishers. We absolutely recognise quality journalism is at the heart of how open societies function — informing and empowering citizens and holding the powerful to account,” he said.

“That’s why we’ve invested $600m since 2018 to support the news industry, and plan at least $1bn more over the next three years.”

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