Facebook boss Mark Zuckerberg has changed the digital giant’s motto numerous times since it was founded.

At one stage it was “move fast and break things”. Later it just became “move fast”.

This week, Mr Zuckerberg lived true to his original motto.

Facebook moved swiftly to ban its Australian users from accessing news in their feeds.

Major publishers, including ABC News, are now restricted from sharing or posting any content on Facebook, meaning any person in Australia no longer gets access to their news via the Facebook site.

The announcement comes in response to proposed new laws in Australia that would force tech companies to negotiate with media companies over how much to pay them for news content.

It is a very different strategy to that adopted by Google, which last month also threatened to pull its search engine from Australia but has this week struck deals with Seven West Media, Nine, and News Corp.

Facebook’s message to the Federal Government is clear. It doesn’t think governments can, nor should, dictate how it operates.

Facebook boss Mark Zuckerberg has changed the digital giant’s motto numerous times.(Reuters: Stephen Lam)

Facebook takes on a political fight

Despite their different tactics this week, Facebook and Google have both spent months negotiating hard against the proposed code.

Both digital giants argue they drive a lot of traffic to news stories that would otherwise go unnoticed.

Both fundamentally believe they should not have to pay news outlets big bucks for content (and the deals that Google have struck with publishers are reportedly in the tens of millions, not anywhere near the billion-dollar requests that were coming from media company bosses when negotiations on the code started).

While Google users rely on getting up-to-date news, Facebook users don’t go to the platform primarily to consume news.

Nevertheless, Facebook has for years been criticised for its role in facilitating the sharing of dangerous political content, fake news and misinformation.

If it removes trusted news sources from its platform (bearing in mind that major media publishers are also accused of printing fake news), does it become less trusted generally and does it lose the audience that it so heavily relies on to pull advertisers?

No doubt these are questions that Facebook and others will keep pondering over the coming weeks as discussions in the media bargaining code laws continue.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume.

Google strikes media deal after search engine threat(Nassim Khadem)

‘No other law like this’

While the social media giant says it is open to locking in individual deals with news publishers, it has repeatedly expressed its opposition to the media bargaining code legislation.

It argues the proposed laws fundamentally misunderstand the relationship between their platform and publishers who use it to share news content.

Will Easton, managing director for Facebook Australia and New Zealand, said in a blog post that the legislation “fails to acknowledge the commercial and technical realities of how publishers use Facebook and the value we provide to them”.

In fact, there is no other law like this anywhere else in the world, but other countries are closely watching what happens domestically.

Facebook fears regulators elsewhere could soon follow suit. And in its view, the potential loss of revenue here is bearable to protect the potential loss of revenue in more lucrative markets overseas.

Facebook says the business gain from news is minimal.

It says news makes up less than 4 per cent of the content people see in their news feed, and that last year it generated about 5.1 billion free referrals to Australian publishers worth an estimated $407 million.

Facebook says news makes up less than 4 per cent of the content people see in their news feed.(Unsplash: NeONBRAND)

More users could ditch Facebook

The financial impact for Facebook will be relatively small, but some say its move could backfire.

Apart from some social media users criticising Facebook for acting in a way that’s “anti-democratic”, on Thursday a raft of users turned to Twitter with “delete Facebook” and #BoycottZuckerberg hashtags.

Others reportedly removed the Facebook app from their phones in response to Facebook blocking health and safety pages including the Department of Fire and Emergency Services WA and the Bureau of Meteorology.

Facebook later reinstated these health and safety pages, but they were among other organisations including retailer Harvey Norman and the Australian Council of Trade Unions that saw their Facebook pages blocked for some time.

Treasurer Josh Frydenberg condemned Facebook’s move, saying it just proved the “immense market power of these digital giants”.

Treasurer Josh Frydenberg has condemned Facebook’s move to ban news content on its sites.(AAP: Mick Tsikas)

But even those with immense power can face reputational damage that, when constantly under attack, becomes hard to repair.

Associate professor Fiona Martin, an expert on digital journalism, online publishing and social media at Sydney University says that individual businesses may start boycotting Facebook.

She thinks Facebook’s news ban could come back to bite it.

Her prediction is that the social media giant will likely dial back some of its blocking of publishers as more people start to complain.

“It will be more responsive to companies that buy advertising with it than it will be to companies that don’t,” Dr Martin said.

Some businesses had developed marketplaces supporting their customers on the Facebook platform, that depended heavily on the ability to share news about their products and services.

“News sharing is part of the whole ecosystem of communities,” she said, noting that some users will inevitably turn to alternative platforms and marketplaces.

Facebook’s move punishes small publishers

Facebook’s move is an annoyance to big news publishers, and if allowed to continue will result in some revenue loss, but it is not a fatal blow.

Aside from using their own websites to reach consumers, there are numerous other social media sites where news publishers can engage including Twitter, LinkedIn and Reddit.

It’s more likely that small news publishers — who are more heavily reliant on referrals to their news sites from Facebook — will suffer.

According to the Australian Competition and Consumer Commission’s (ACCCs) Digital Platforms Inquiry final report, Facebook’s role in news referral services is far lower than Google’s.

In 2017-18, 34 per cent of referrals to the websites of Australian print/online and online-only news media businesses came from Google, while only 16 per cent of referrals came from Facebook.

The ACCC estimates that, if the figure is adjusted to account for access via publishers’ apps, about 26 per cent of referrals are from Google and about 12 per cent of referrals are from Facebook.

The ACCC report contended that, “while the number of referrals from Facebook to news media businesses has declined” over time, “many news media businesses in Australia would likely lose significant revenue, with adverse impacts on their business, should they forego referrals from Facebook”.

For news publishers, there is also value in connecting via Facebook to younger audiences.

According to the University of Canberra’s 2020 digital news report, about 39 per cent of Australians use Facebook for general news and 49 per cent use Facebook for coronavirus news.

The report found that for Gen Y and Z, local social media or online groups are the most popular way to access news about their area.

Almost one-quarter (24 per cent) of Gen Z use local social media or online groups, while 30 per cent of Gen Y say they use social media or online groups to access local news.

If the Facebook news ban is not lifted, news publishers will need to find new platforms to reach wider audiences.

But will Facebook lose crucial audiences and advertisers as well?