THE FACEBOOK FRACAS

The Facebook-Australian furore drew world-wide media condemnation. I don’t get it.

The claim that Facebook should pay for publishing traditional media news stories was fair enough if that’s what the tech giant was doing, but it was not.

Rather, it acted as a vehicle to access media web-sites which is what those site owners desperately want, namely readers.

Facebook’s role was no different than that of the corner dairy selling newspapers. But no-one accuses the dairies of being publishers and of profiting from this at the media company’s expense because as with Facebook, it’s not true plus the publishers need those paper sellers.

The real heart of the issue is the inability of governments to tax the huge profits Google, Facebook and company make and easily avoid paying tax on.

To repeat; Facebook, Google and their ilk do not publish others material. They simply provide access to it. The feigned media horror at Facebook’s withdrawal of that access was because it harmed those media companies’ interests, nothing else.

Print media everywhere know their days are up and their future lies with their web-sites. But far from grossly dishonest attempts to charge Facebook, an excellent case can be made to pay them, just as they pay the corner dairies for selling their print version.

I’m a lifelong observer of print media dishonesty but their beatup over this matter surpasses any past sins.

NOTE – This was written on Sunday. I’m delighted to see a similar criticism on today’s New Zealand Herald site.

11 Comments

Right on the money Bob. Once again Rupert is wielding his political power to his own advantage. Besides, newspapers were doomed a decade before Facebook and Google came along. By then they had already lost their classified advertising, typically close to 50% of their revenues. They have proven over and over again their inability to respond to the internet age and build new products for young audiences. Could that because a lot of journalists are so far up themselves they think the usual rules of business do not apply to them, and that instead the world owes them a living for the “service” they perform?

Finally seeing someone else has put to words what I was thinking (though at the same time thinking I must’ve been barking up the wrong tree, simply because nobody else seemed to be saying it).

Having regained media feed onto FB last week, and now paying much more attention to what happens when I click their links, I’m stumped how FB gains a cut of the media articles I read when I click the link on FB. In every case, clicking the FB link lands me directly at the original source material – more often than not, landing me at a newspaper article. Unless I’m missing something really obvious in this, how does FB make money out of that transaction? (As I believe was being claimed.)

That said, I feel FB scored an own-goal by going nuclear when they pushed the ‘stop’ button. I noted that several hyper-local sources of information, that nobody could ever reasonably claim were media outlets in any sense of the word, were taken off-the-air while FB and Frydenberg duked it out.

That would be true if Facebook was just providing links but over time it had encouraged its users to go to Facebook rather than the publisher websites via its news feed with headlines and content previews. In 2015 Facebook started reformatting the publisher’s news content it did not own on its mobile app via “Instant Articles” without links to the original website. Advertiser revenue that arguably should have gone to the content publisher instead moved to Facebook because that was where the eyeballs were.
There’s a TechCrunch article from 2018 that summarises this well. https://techcrunch.com/2018/02/03/facebooks-siren-call/
It’s interesting that Google has entered into partnerships with Australian media companies whilst Facebook temporarily adopted a more punitive approach.

    You are right. Zukerberg is a standover merchant. Irrespective of where the news comes from or who the interface is FB make a fortune and are very tax shy. They are experts at transfer pricing and seek low tax jurisdictions such as Eire. It could only be a US Corp that would withdraw essential services under threat ( remember Biden did it in the Ukraine ) and act like Al Capone. On top of this Zuckerberg and his ilk censor with gay abandon.

    Now that provides some needed answers.

This is a genuine question as I disliked the concept of Facebook etc from day one. I simply hated the concept but dowish I had foreseen how the sheeple would climb aboard living their lives as open books whilst the share value of said company soared.
But to quote ” Facebook, Google and their ilk do not publish others material. They simply provide access to it. The feigned media horror ….” . Surely this can’t be that simplistic. Once directed to the article do you then have to pay to read it? If it was as simple as described a company like FB with a GDP bigger than most countries would have fought in court to protect its business. Unlike most countries in the world FB actually has money in the bank to fight a protracted battle. Very deep pockets.
Can someone explain please?

    Hi theedgeisnigh. I think you’re on the money. Once you land at an article, you have to pay for it (unless you’re already a subscriber to whatever news outlet you’ve landed at.) I subscribe to several media organizations and, for those I don’t, I bang into their paywall. When I hit those, I can’t then access their article(s), so skulk off back to fb.

    In all my comings and goings onto, and from, media articles I have arrived at via fb, I still fail to see how fb is making any money off my transactions.

    ALL the advertising that gets in front of my eyeballs occurs at those media sites I land on. How does that make fb money?

      If you can’t see what the product is; YOU are the product.
      The more time you spend on FB, the more info they collect about you, what type of articles you click on etc. They are able to sell the data collected on to advertisers, pollsters and the like.

You raise two interesting subjects.

One is not too dissimilar to the kim dotcom saga, where big business is just throwing its political weight around to distribution. Surely the winner shouldnt be taking it all?

The second is a fair taxation system. It is long overdue to tax gross revenue of these big corporates and charitable organisations used to minimise tax, who use public infrastructure without paying their fair share.
Helicopter drops further corrode the tax system.

I do wonder what’s next; after the vaccine. Buffet seems to be confident, but I fair his latest comments are based on self interest with his monopoly businesses.

    GS.
    You may find this interesting.
    https://youtu.be/RYfmRTyl56w
    It reinforces everything my gut is telling me. But sitting on a heap of cash is driving me nuts as as markets both property and share, keep going up due to the printing machines. The US will be bankrupted in 2 years under Biden mass printing. To top it off the Mexicans are flooding to the borders ready to cross.

Correct. I don’t know whether anyone has come up against US Anti Trust Laws and blatant discrimination like the Jones Act then you can understand how Zuckerberg gets away with murder. Kim Dotcom got in the road of the left leaning Hollywood steam rollers who are represented by a Democrat lawyer who has white pointer type teeth and clout. They accused Kim of stealing intellectual property now similar to FB. Their long arms stretched to our police who raided Kim in Auckland with helicopters and machine guns.
Don’t underestimate the power and coercion of the reach of US laws. They are like Putin’s Russia but more corrosive.

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