This is unsurprising given Meta’s broader shift away from news content, but it’s another blow for media organizations, many of which are already struggling to maintain relevance (and revenue) within the changing online media landscape.
Today, Meta has announced that it will cease paying Australian news outlets as part of its broader shift away from news content.
As per Meta:
“In early April 2024, we will deprecate Facebook News – a dedicated tab in the bookmarks section on Facebook that spotlights news – in the US and Australia […] This is part of an ongoing effort to better align our investments to our products and services people value the most. As a company, we have to focus our time and resources on things people tell us they want to see more of on the platform, including short form video.”
Meta further notes that usage of Facebook News in Australia and the U.S. has dropped by over 80% in the last year.
Meta says that the current agreements will be honored, but it will not be entering into new payment arrangements with Australian publishers.
“While we’ll be deprecating Facebook News in these countries, this announcement does not impact the terms under our existing Facebook News agreements with publishers in Australia, France and Germany. These deals have already expired in the US and the UK. Additionally, to ensure that we continue to invest in products and services that drive user engagement, we will not enter into new commercial deals for traditional news content in these countries and will not offer new Facebook products specifically for news publishers in the future.”
The announcement marks the end of Meta’s truce with Australian government officials over what the government deemed as “fair payment” from Meta for use of news content.
Australia’s “News Media Bargaining Code” made international headlines when it was implemented in 2021 after failed negotiations with Meta led to all Australian publisher content being blocked on Facebook and Instagram.
After rapid renegotiation, Meta lifted the ban, and agreed to pay Australian publishers a lesser amount for news content use. But the stand-off raised more questions as to the power that Facebook wields within the broader publishing landscape, and how much it actually needs, or doesn’t need, local news content.
Meta has long held that news content is a minor part of its service (in today’s announcement, Meta reiterated that news makes up less than 3% of what people around the world see in their Facebook feed), and now, it’s likely less so than ever before, which is why Meta’s stepping away from its past news org deals entirely.
Which, as noted, isn’t really much of a surprise.
Last week, in response to reports that Indonesia is also considering implementing laws to force Meta to pay local publishers for the use of news content, I wrote that:
“Ultimately, Meta misstepped by negotiating with Australian regulators, and accepting a watered-down version of that nation’s revenue share proposal, because that opened the door for others to enact the same.”
Meta should never have dealt with Australian publishers in the first place, because the fact that it agreed to share any money at all with local media organizations only prompted more regions to consider their own proposals along the same lines.
All along, the media organizations pushing for such deals have based their arguments on a misinterpretation of market dynamics. It’s not Meta that needs their content, it’s the businesses that benefit from expanded distribution via Meta’s apps.
And now, as Zuck and Co. look to take more definitive steps to distance themselves from news content, they need such less than ever.
Here’s the proof. Meta stopped showing content from Canadian publishers in its apps on August 1st last year.
Here’s Meta’s daily active user chart for Q4 2023:
Usage in the North American region actually increased in the period, despite not showing any Canadian publisher content the whole time.
Meta is also now actively looking to limit news discussion on Threads, while it’s been gradually implementing similar initiatives in its other apps.
AI-recommended Reels have driven virtually all of its engagement gains over the past two years, with short videos, targeted to users based on their interests, and not just the Pages that they follow, proving to be a winning strategy, as well as a lever to shift away from divisive posts.
And now, it’s no longer theoretical as to whether Meta can live without news content, it’s definitively proven, which leaves publishers, and the governments representing their interests, in a much worse negotiating position.
So while the Australian Government could push Meta on this, and look to hold it to the rules of the News Media Bargaining Code (and apparently, it is planning to), Meta knows that it can block publishers with minimal impact.
Basically, Meta’s not going to pay. And now, Australian authorities will have to decide whether publishers are able to live with what they have, or if it should force Meta to seal off the last spurts of referral traffic that its apps still send their way.
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