Rupert Murdoch’s News Corp succeeds in striking deal with Facebook
![](jpg/1-12.jpg)
News Corp is one of the leading media conglomerates in Australia, with more than 8,000 employees nationwide. The diversified information and media services company was formed by Robert Murdoch at the beginning of the 21st century. Headquartered in Sydney, News Corp is at present the chief digital destination for news, business, sports, property, family, and lifestyle. The media empire exercises influence at the state level, so many are keen on appealing to the tabloids. News’ style of journalism has imposed itself in cities such as Adelaide, Brisbane, Darwin, and Hobart, just to name a few. All in all, News Corp is a pioneer, advocating for less interference from the government in the media.
Not that long ago, Rupert Murdoch’s News Corp managed to arrange a major content-supply deal with Facebook. Therefore, it’s the first important media outlet in Australia to collaborate with Facebook under the controversial new laws. As we can all remember, Australia passed a new media law that requires tech giants such as Facebook and Google to pay local media outlets and publishers for news. Facebook negatively reacted to the event by blocking access to news content. More exactly, users were unable to access any Australian news publications on the Facebook platform. Facebook’s shutting down of all media outlets in the country for almost a week enraged world leaders. Unintended consequences included blocking emergency services and government health pages.
Coming back to the subject, News Corp disclosed that the agreement covers major newspapers and periodicals such as The Australian, Daily Telegraph, and Herald Sun. Additionally, Sky News Australia, the conservative 24-hour cable and satellite channel, has reached an advantageous agreement with the American technology conglomerate. For the time being, we don’t know the value of this agreement. The only thing we know for sure is that this accord marks the end of the strong disagreement between Facebook and news publishers. Google cut a deal with News Corp on February 17th this year. Although the American multinational technology company threatened to shut down its search engine, it had a change of mind.
Just how valuable is news to Facebook?
Tech giants such as Facebook have literally robbed journalism of its revenue. Many people have abandoned subscriptions in favor of social media platforms. Users of technology platforms have information at their fingertips. They see breaking stories on their feeds and, if they would like to find out more, they can go directly to the news sites. Social media users don’t even bother to read the full article. More often than not, they scroll through their feeds until they come across interesting headlines. Ironically, while people are consuming more news than ever, media outlets are losing revenue. Even though they’ve hoped that tech giants would pay them for news, that didn’t happen.
In the past, Facebook has claimed that it doesn’t find any value in news. It’s true that the American multinational technology company doesn’t make money directly from news, yet it’s valuable, nonetheless. Carrying news content drives traffic, which in turn drives advertising money. If dominant companies in the information technology industry wouldn’t make any money from news content, then they wouldn’t invest heavily in news products. As Facebook’s product offering and targeting have improved, its role as a news provider has expanded. The fact is that the presence of news is important in terms of audience engagement.
Roughly one-third of Australians read the news on Facebook, no matter if they’re searching for it or it’s recommended to them. Age is no longer a barrier to digital influence. This translates into the fact that senior citizens are actively deploying web-based portals as their main source of information. The widespread use of smartphones has made a contribution to news consumption; it represents a game-changer for news media, which includes live streaming and video reporting. The issue is that some technology companies get away without paying journalistic organizations.
Robert Thomson, chief executive of News Corp, affirmed that the content-supply deal with Facebook represents a turning point in reconstructing the terms of the trade as far as journalism is concerned. He added that it will have a considerable impact on Australian news businesses. It’s largely agreed upon that tech giants should pay for news. Microsoft Corporation is one of the fervent supporters of the Australian law and even urges the United States to copy it. When Google threatened to pull its search engine, Microsoft was ready to step in and expand its search product Bing offering small firms the opportunity to transfer their advertising business to Bing.
Australia can finally claim victory thanks to Rupert Murdoch’s contract with Facebook
Australia has long been battling against rich corporations such as Facebook and Google, who continue to grow their income at the expense of domestic media and competitiveness. It passed a world-first law forcing tech giants of this digital age to negotiate payment with journalism organizations that create the news hosted on their platforms. Following a great deal of criticism, the American multinational technology company decided to put the guns down and talk. Practically, the world’s largest social network reconsidered its standing and reached a payment agreement with Rupert Murdoch’s News Corp. It’s a win-win situation, to speak. Facebook initially objected to the new media law insisting on the fact that it’s unfair and unworkable. Well, the people at Facebook think differently now.
So, news will soon be restored to the online platform and Facebook will recompense Australian media companies. It’s believed that the Australian law will set a precedent for the way in which other countries regulated Big Tech. Canada, for instance, promises to be next. The Minister of Canadian Heritage, Steven Guilbeault, claimed that the country would be the next one to make sure that Facebook pays for its news. Similar legislation will make its appearance in the months to come. For those of you who don’t know, Canadian media organizations have been concerned about a possible market failure, which would become reality without the support of the government.