Facebook has today announced it will spend $1 billion on the news industry over the next three years.

The move comes less than a week after the social media giant blocked Australian users from accessing news on the site over a new law that forces tech companies to pay for media content.

But following talks with the Australian government at the weekend, which resulted in a number of amendments to the legislation, Facebook unblocked users in the region.

Changes to the law include allowing two months for tech companies to strike private deals for news content before the government arbitrator gets involved.

Facebook said that it has already invested $600 million into the industry since 2018.
In a blog headlined “The Real Story of What Happened With News on Facebook in Australia”, Facebook vice president of global affairs Nick Clegg said that the reason Facebook blocked users in the region was because of a “fundamental misunderstanding of the relationship between Facebook and news publishers."

“It’s the publishers themselves who choose to share their stories on social media, or make them available to be shared by others, because they get value from doing so,” wrote Clegg.

He claimed that last year Facebook generated around 5.1 billion free referrals to Australian publishers worth AU$407 million to the news industry.

The former Lib Dem leader and UK deputy prime minister said that assertions that Facebook steals or takes original journalism for its own benefit “always were and remain false.”

“It is understandable that some media conglomerates see Facebook as a potential source of money to make up for their losses, but does that mean they should be able to demand a blank check?” said Clegg. “That’s what the Australian law, as it was proposed, would have done.
He continued: “Facebook would have been forced to pay potentially unlimited amounts of money to multi-national media conglomerates under an arbitration system that deliberately misdescribes the relationship between publishers and Facebook — without even so much as a guarantee that it is used to pay for journalism, let alone support smaller publishers.”

Clegg compared the pre-amendment law to “forcing car makers to fund radio stations because people might listen to them in the car – and letting the stations set the price.”

“In order to comply, Facebook had two options: provide open ended subsidies to multi-national media conglomerates or remove news from our platform in Australia,” added Clegg. “Thankfully, after further discussion, the Australian government has agreed to changes that mean fair negotiations are encouraged without the looming threat of heavy-handed and unpredictable arbitration.”

Last month Facebook announced deals with The Guardian, Telegraph Media Group, Financial Times, Daily Mail Group, Sky News and others, including local, regional and lifestyle publishers, to pay for content in its Facebook News product in the UK.

The company said that similar deals have been reached with publishers in the US, while in France and Germany the platform is in active negotiations.

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