Facebook’s claim that it does not need news content to succeed has been called out as a “bluff” by the head of an influential publisher trade body.
Rejecting an Australian plan that would see it pay for news, the social media giant described the content as “highly substitutable” in a submission to Canberra regulators.
Jason Kint, the chief executive of Digital Content Next in the US, dismissed Facebook’s claim as a “bluff that will fail”.
He compared Facebook’s approach with that of Google in Spain. In 2014, the search giant closed down Google News in the European nation to avoid complying with a new law that would force it to pay publishers for links and headlines.
Kint told Press Gazette: “The tactic is to send a message they don’t need news and keep the requirement for a fairer deal from spreading to other nations.
“But here’s the reality: without news, there is little currency of quality information. Without news, there is less trust. Without news, Facebook is a message board environment full of high-risk user-generated content. Without news, Facebook risks advertisers really starting to understand all of this.
“It’s a bluff that will fail globally for them.”
Australia’s treasurer, Josh Frydenberg, announced in April that Google and Facebook would be forced to pay for news content, to support publishers that have seen their advertising revenues eaten away by the “Duopoly” in recent years. He ordered the Australian Competition and Consumer Commission (ACCC) to draw up a mandatory code.
Facebook’s response to an ACCC consultation, which emerged this week, rejected the idea it would pay for news.
The company claimed that publishers “gain more from Facebook than we gain from news content”, which it described as “highly substitutable” in commercial terms.
The US social media giant also suggested that it currently makes a loss on hosting publishers on its platform, and hinted that it could choose to charge news businesses to use its services.
Picture: Reuters/Dado Ruvic/Illustration