The Echo-nomist

Google and Facebook have been all over the news. But what exactly is going on? 

Everyone complaints about how technology giants keep getting richer at the expense of new outlets. They sell advertisement linked to their articles without sharing any revenue. 

Australia decided it had had enough and it was time to do something about this. So they proposed a law that requires tech giants (like Facebook, google) to pay publishers for linking their articles on their platforms. 

A month ago, Google threatened to pull it’s search engine out of Australia is the nation’s legislators adopted the proposed measures. Fast forward to February, Google is making payment agreements with publications in Australia. In a three year global deal they agreed to pay Rupert Murdoch’s News Corp to publish their news content. 

Facebook decided to act like the rebellious kid in class. Google sincerely striked agreements but Facebook decided not to pay. Instead, they will restrict publishers and people in Australia from sharing or viewing Australian and international news content. On Feb 17, William Easton, the managing director of Facebook Australia and New Zealand, stated “The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content.”

What does this mean? 

For starters, Australian FB users cannot view or share Australian or international news content on Facebook or content from Australian and international news pages. Other than this the international users cannot view or share Australian news content or content from Australian news Pages. 

Facebook’s decision can either backfire or change the way Facebook works. By not complying to Australia’s law they are saving money. If this model works for them, they might just expand to other countries. FB has been criticized for circulating one side of the story and fake news. That’s why people might just prefer choosing the news they read and have a non-political FB feed. If this leads to an increase in user satisfaction or interaction or happiness they will test this models in other countries too. However the users could also respond negatively. Many users get their news from apps like FB and if that’s taken away from them they may be out of loop. This will lead to consumer dissatisfaction. In this case FB might just strike agreements with Australian news outlets. We can just wait and watch what happens next.   

Google and Facebook have been all over the news. But what exactly is going on? 

Everyone complaints about how technology giants keep getting richer at the expense of new outlets. They sell advertisement linked to their articles without sharing any revenue. 

Australia decided it had had enough and it was time to do something about this. So they proposed a law that requires tech giants (like Facebook, google) to pay publishers for linking their articles on their platforms. 

A month ago, Google threatened to pull it’s search engine out of Australia is the nation’s legislators adopted the proposed measures. Fast forward to February, Google is making payment agreements with publications in Australia. In a three year global deal they agreed to pay Rupert Murdoch’s News Corp to publish their news content. 

Facebook decided to act like the rebellious kid in class. Google sincerely striked agreements but Facebook decided not to pay. Instead, they will restrict publishers and people in Australia from sharing or viewing Australian and international news content. On Feb 17, William Easton, the managing director of Facebook Australia and New Zealand, stated “The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content.”

What does this mean? 

For starters, Australian FB users cannot view or share Australian or international news content on Facebook or content from Australian and international news pages. Other than this the international users cannot view or share Australian news content or content from Australian news Pages. 

Facebook’s decision can either backfire or change the way Facebook works. By not complying to Australia’s law they are saving money. If this model works for them, they might just expand to other countries. FB has been criticized for circulating one side of the story and fake news. That’s why people might just prefer choosing the news they read and have a non-political FB feed. If this leads to an increase in user satisfaction or interaction or happiness they will test this models in other countries too. However the users could also respond negatively. Many users get their news from apps like FB and if that’s taken away from them they may be out of loop. This will lead to consumer dissatisfaction. In this case FB might just strike agreements with Australian news outlets. We can just wait and watch what happens next.