Meta ramps up its threats to block the news

In 2020, the Australian government proposed a law called the News Media and Digital Platforms Mandatory Bargaining Code, which forced large tech companies such as Google and Meta to negotiate payment deals with news publishers. In response, Meta not only blocked users in Australia from seeing news content on Facebook but prevented them from posting links to any news stories, regardless of where they were published. The platform also blocked pages belonging to hospitals and emergency services, which Meta described as a mistake but insiders alleged was a deliberate negotiating tactic. Fast-forward two years, and Meta says that it is now prepared to block news in Canada in response to a bill in that country that is based on Australia’s bargaining code. (I wrote about the bill back in March.) Although Meta is not currently blocking all news from its platform in Canada, it is blocking access for what it described as a small percentage of users—and if the law is passed, the company said that it intends to “end the availability of news content in Canada permanently.”

In a statement earlier this month, Meta described Canada’s bill, which is called the Online News Act, as “fundamentally flawed legislation that ignores the realities of how our platforms work [and] the value we provide news publishers.” In a more in-depth statement last fall, Marc Dinsdale, the company’s head of media partnerships in Canada, said that the bill is unacceptable, in part, because it “misrepresents the relationship between platforms and news publishers.” The legislation is based on the presumption that Meta unfairly benefits from its relationship with publishers, Dinsdale wrote, “when in fact the reverse is true.” Meta says that its internal data shows that posts with links to news articles make up less than 3 percent of what people see in their Facebook news feeds, and that the majority of links to news content are posted by the publishers themselves.

Rachel Curran, the head of public policy for Meta Canada, said that users will be included in the current news-blocking test on a random basis, and will only be informed that they are blocked from sharing news if they try to post a link to a news story. According to a report from the Canadian Broadcasting Corporation, the number of news publishers whose content will be affected by the test will not be made public, with inclusion in the test also randomized. “We believe that news has a real social value,” Curran told the Canadian Press news agency. “The problem is that it doesn’t have much of an economic value to Meta. So we are being asked to compensate news publishers for material that has no economic value to us.” In the past, Meta said that it cared about funding journalism. As I noted in a recent piece for CJR, it seems to have changed its mind.

Meta isn’t the only company experimenting with blocking the news in Canada: in February, Google said that it was removing links to Canadian news content for a percentage of its users for a period of five weeks. In testimony before the Canadian Senate, Richard Gingras, the vice president of news at Google, said that if the law passes, it might have to remove links to news articles from search results. Forcing Google to negotiate with news publishers to compensate them for their content, Gingras said, would represent an “uncapped financial liability” for the company. Google has also complained that the law defines eligible news businesses in an overly broad way, meaning that it would “effectively subsidize any outlet that explains current issues or events of public interest.”

Like Meta, Google has made the argument that it doesn’t benefit financially from hosting links to news content but rather sends billions of clicks to news sites, which are then free to monetize those clicks. But the platforms rarely mention that they dominate the online advertising market. And their arguments don’t seem to have swayed those pushing the Canadian bill. Justin Trudeau, Canada’s prime minister, has described Google’s decision to remove links to news content from its search results as “a terrible mistake.” The law is currently being considered by the Canadian Senate, which rarely challenges legislation once it has been passed by the lower house of Parliament. Paula Simons, a senator who sits as an independent, told the Toronto Star last week that the timing of Meta’s threats to cut off access—coming just as the Senate was holding hearings on the bill—“could be considered by some to be uncomfortable,” though she added, “If they’re trying to intimidate me, I don’t intimidate very easily.” (Simons is a former colleague of mine who was appointed to the Senate after a career as a journalist.)

In addition to its moves in Canada, Meta has recently made similar threats to cut off access to news in California, which is considering a similar law that would force the digital platforms to pay for linking to news articles. Instead of requiring them to negotiate payment terms with individual publishers, as the Australian and Canadian bills mandated, the California law—called the California Journalism Preservation Act—would impose a state-imposed “journalism usage fee” on the platforms; the proceeds would then be distributed to news publishers, which would be required to spend at least 70 percent of the money creating new journalism jobs. Meta said last week that it plans to block access to all news articles in California on both Facebook and Instagram if the law passes as written.

Andy Stone, a spokesperson for Meta, said on Twitter that if the California law passes, the company would be “forced to remove news from Facebook and Instagram, rather than pay into a slush fund that primarily benefits big, out-of-state media companies.” Stone added that “it’s pay or remove the news. Our hand is being forced.” Other states will likely be watching to see how California’s proposed law fares and whether Meta follows through on its threats as a result, just as other countries are likely watching the outcome of Canada’s proposed legislation. “We are now in a no-holds-barred battle for revenue, with many news companies, emboldened by the settlement in Australia, becoming quite vocal and aggressive in arguing this case,” John Wihbey, a journalism professor at Northeastern University, told NPR.

That’s at least in part due to the fact that, in the end, Meta’s threats in Australia turned out to be a negotiating tactic: the company relented after the country’s news bargaining code was modified to allow the platforms to strike financial deals with Australian publishers directly, rather than paying for every use of a publisher’s content. As Bill Grueskin, a professor at the Columbia University Graduate School of Journalism, noted in a piece for CJR last year, the deals that the platforms struck led Australian publishers to receive more than a hundred and fifty million US dollars in the year after the law was passed—although some members of the media expressed concern about becoming so financially reliant on tech platforms.

If Meta and/or Google are using the threat of a news blockade to extract concessions from either Canada or California, it’s unclear what kinds of favors they might be looking for. Canada’s proposed law already allows the platforms to negotiate deals with publishers, rather than forcing them to pay for every news link they publish. It also gives Canada’s communications regulator the power to exempt the platforms from the law if the agreements they strike with publishers meet certain criteria, one of the concessions that led Meta to relent in Australia. And, while the Canadian law requires the platforms to disclose the terms of their deals—unlike in Australia, where, Grueskin wrote, key details of the arrangement between the government, the platforms, and publishers have been “guarded like they’re nuclear launch codes”—they only have to disclose them to the government. Keeping the details of its agreements functionally secret ultimately benefits the platforms, because it makes it less likely that other publishers can then use those terms as leverage.

In the meantime, blocking access to the news for millions of users could theoretically goad the Canadian government or the state of California into taking punitive action against the platforms, which could be even more costly than any payments for linking to news. In any case, news consumers in Canada and California can take some comfort in the knowledge that every time Google or Facebook has blocked access to the news on their platform, they have eventually reinstated it—although in some cases it has taken a long time for that to happen. In Spain, for example, Google cut off access to its Google News platform for more than eight years, only restoring it last year after the Spanish government changed the laws that cover paying for links to news. The news, of course, was still available elsewhere.

Other notable stories:

• Chris Licht is out as chairman and CEO of CNN—a little over a year since taking the job and less than a week after a widely read profile in The Atlantic painted a devastating portrait of dysfunction and newsroom unrest under his leadership as he tried and failed to execute on bosses’ wish that the network dial down Trump-era outrage and move closer to the political center. (CJR’s Jon Allsop wrote about the profile and Licht’s tenure in Monday’s newsletter.) Amy Entelis, Virginia Moseley, and Eric Sherling—a trio of veteran CNN executives—will lead the network until Warner Bros. Discovery, its parent company, picks a successor to Licht, a process that could take awhile. According to Oliver Darcy, CNN’s media reporter, network staffers breathed a “sigh of cathartic relief” when Licht’s firing was confirmed, but still feel apprehensive as to what might come next.
  
• The LA Times laid off seventy-four newsroom staffers; reporters were mostly spared, but editors, producers, and photographers were not. The paper’s union accused bosses of failing to first offer buyouts, and called the layoffs “outrageous and reckless.” (Bosses denied any wrongdoing.) Meg James, an LA Times reporter, notes that the paper had been spared significant cuts since Patrick Soon-Shiong acquired it five years ago.
• On Tuesday, Tucker Carlson, who was ousted from Fox in April, debuted a new show on Twitter. Yesterday, Fox wrote to Carlson accusing him of breaching non-compete provisions in his contract with the network. Carlson is said to believe that Twitter is not a direct competitor of Fox and that his show on the platform is protected by his First Amendment rights, but it’s not clear if this defense will work. Axios has more details.
  
• In the UK, the right-wing Daily Telegraph, its Sunday sister title, and The Spectator magazine will be put up for sale after a bank seized them from their current owners, the Barclay family, in a dispute over unpaid debts. Per The Guardian, the Murdochs, the owners of the rival Mail, and Axel Springer could be interested in the titles; Jeff Bezos was linked to a possible takeover of the titles in the past, but is now seen as a long shot.
  
• And OutVoice, a platform that specializes in freelancer management and payment, is acquiring Study Hall, a newsletter and virtual community for freelance journalists, Sara Fischer reports for Axios. Kyle Chayka, a New Yorker writer who cofounded Study Hall, said that the acquisition will make the community sustainable and provide opportunities for its freelance members to connect with media companies that contract with OutVoice.

ICYMI: Chris Licht, Chuck Todd, and a tale of two Sunday shows