Meta to scrap deals with Australian publishers under 2021 media code

The government has vowed to take swift action after Facebook owner Meta announced it no longer intends to pay for local news.

The blowout of Facebook parent company Meta’s decision to bail on its Australian media deal could cost local news publishers as much as $200 million.

The social media giant revealed on Friday it would not renew deals with local outlets when they expire this year and would remove its Facebook News tab in April.

In a statement, Meta said the move was part of an “ongoing effort to better align our investments to our products and services people value the most”.

“The number of people using Facebook News in Australia and the US has dropped by over 80 per cent last year,” the statement said.

“We know that people don’t come to Facebook for news and political content – they come to connect with people.”

Facebook parent company Meta will cease paying for news in Australia. Picture: Getty Images.

The move will mark an end to the three-year deal struck between Meta and a host of publishers in 2021 under the news media bargaining code.

The deals ensured the social media behemoth paid local outlets for the third party news content it published on its website.

By cancelling the deal, Meta is seen not to be removing news content from the Facebook platform; instead, it just will not pay for it.

News of the cancellation drew quick condemnation from the federal government.

Communications Minister Michelle Rowland said the move was “a real threat” to journalism in Australia.

“It’s a threat and it’s one that we take very seriously,” she said.

“Unfortunately, Meta has made this decision. It’s a decision which suits their commercial interests and imperatives.

“But, it is inconsistent with the government’s overall aim of ensuring that we have strong public interest journalism in this country that it is properly compensated.

Assistant Treasurer Stephen Jones said the government had advised media companies it would be “taking all of the steps available under the news media bargaining code.”

“The government takes the view that this is a dereliction of its (Meta’s) responsibility to Australia ... We’re deeply disappointed,” Mr Jones said.

“We’re not talking about some plucky little start-up here. We’re talking about one of the world’s largest and most profitable companies.

“It has a responsibility to ensure that it pays for the content that is using it. The government is adamant we’ll be backing the code.”

Communications Minister Michelle Rowland said the government’s expectations of Meta were clear. Picture: NCA NewsWire / Martin Ollman

Mr Jones ruled out foreshadowing what action the government might take, but said he “did not intend to take months”.

“Regretfully, it hasn’t been a surprise to us given the statements that have been coming to us from news publishers directly over the last few months,” he said.

“What we want to happen is to see meta back at the bargaining table, negotiating in good faith, and doing the very Australian thing of ensuring that you pay for what you use.”

Mr Jones said he would have to be satisfied there was an abuse of market power and would speak to teleco’s Telstra and Optus, as well as the ACCC, before proceeding.

He also downplayed claims by Meta that news content accounted for just 3 per cent of viewed material, stating that Meta had “deprioritised news content”.

News Corp Australasia executive chairman Michael Miller joined media executives in slamming Meta for using its “immense market power to refuse to negotiate”.

“I welcome the government’s support for the media industry and its wholehearted commitment to upholding our laws and the News Media Bargaining Code,” he said.

“Meta is using its immense market power to refuse to negotiate, and the government is right to explore every option for how the Media Bargaining Code’s powers can be used.”

Mr Miller said Meta was attempting to mislead Australians by saying its decision was “about the closure of its news tab product”.

“However, the vast majority of news on Facebook and Meta is and will continue to be consumed outside this product,” he said.

“Meta’s decision will directly impact the viability of Australia’s many small and regional publishers and this is a pressing issue for the government to confront.

“We will work in any way we can to assist the processes the government is putting in place.”

Deputy Prime Minister Richard Marles said he was disappointed by the move. Picture: NCA NewsWire / Martin Ollman

Deputy Prime Minister Richard Marles earlier told Sky News that he was “very disappointed” in Meta’s decision.

“I think this shows contempt really on the part of Meta in respect of the news sector and news organisations in this country,” he said.

“At the end of the day at news organisations, the news sector has a right to be properly remunerated for the product which they produce.

“We need to have a vibrant news sector which is underpinned by journalism and journalists with a journalistic ethic, and all of that is really important.

“That’s how you get reliable news. I think Meta has shown complete contempt for that sector in this country by the decision they have made.”

Meta announced in September 2023 that it was removing the Facebook News tabs from its sites in the UK, France, and Germany.

News deals struck with US and the UK had also already expired prior to Friday’s announcement.

The social media company claims news makes up less than 3 per cent of what people see globally in their Facebook feed.