Facebook, Google probe unleashes Australian media's fury over algorithms

7 May 2018 10:20am
Australian Flag on Keyboard

4 May 2018. By James Panichi.

Facebook and Google’s submissions to Australia’s groundbreaking inquiry into online platforms are built on a remarkably simple premise: they aren’t out to compete with media, they’re in the game to help readers find the best content that newsrooms around the world have to offer.

In fact, the platforms go further, arguing that they’re value neutral — blank slates that provide publishers with a once-in-a-generation opportunity to market their wares to a broader readership than ever. The world is — or should be — the media companies’ oyster.

The US tech companies have just one problem: nobody's buying their premise.

A unifying theme emerging from the more than 50 submissions to the inquiry by the Australian Competition & Consumer Commission, or ACCC, is that the willingness of Google and Facebook to fiddle with the algorithms that underpin their relationship with news publishers is — at best — problematic.

Some submissions go further, saying that the platforms’ manipulation of algorithms is, fundamentally, a deeply uncompetitive practice. Facebook and Google may be promising news producers unfettered access to consumers, but the rules of engagement are both unclear and constantly changing.

The submission by Rupert Murdoch’s News Corp. Australia lists the platforms’ “strategies to entrench their dominance and to foreclose competition from publishers for both readers and advertisers” — a list of six competition grievances tailor-made to sound alarm bells among regulators across the globe.  

One of News Corp.’s complaints is the refusal of the platforms to supply publishers with data interoperability — in short, the ability to know what content Facebook and Google are looking for. This forces publishers to remain constantly on the back foot and at a competitive disadvantage, News Corp. argues.

The platforms are changing algorithms “with little to no notice and refusing to supply publishers with information on how the algorithms work and which content [are] priorities,” News Corp. says, echoing the Australian-born Murdoch’s publicly stated distaste for tech companies receiving free content.

The distrust of Facebook's and Google’s algorithms is a unifying thread in most of the submissions. The publishers want the Australian regulator to see the platforms not as empty vessels, but as the cunning controllers of a monopoly pipeline through which all media content must pass.

Entrenched market power
Australia’s Nine Network — one of the country’s three commercial, free-to-air television broadcasters — says that the lack of transparency on how algorithms link viewers to content creates “many opportunities for abuse.”

Nine’s submission says the system created by Facebook and Google “permits unilateral changes to their respective algorithms that have the capacity to deliver them commercial advantages and entrench their market power in digital advertising by foreclosing competition.”

Seven West Media, a print- and electronic-media company, takes the argument further, using the example of Facebook’s recent algorithm change that had the stated objective of “prioritizing conversations and meaningful interactions with people.”

What did that mean? Seven West says it had no idea and was left at an enormous competitive disadvantage.

Prior to the changes, the company says its Pacific Magazine division had invested “significant” money and resources to attract followers through its Facebook pages — a strategy that included engaging Facebook through its online advertising platform to conduct promotional activities to boost its following.

“However, the changes to Facebook’s News Feed algorithm now mean that Facebook will not publish Pacific Magazines’ content organically in the News Feed of those followers, or will deprioritize those posts, unless Pacific Magazines pays,” the company says, adding that to match the previous reach would cost it millions of dollars.

Algorithmic regulation
Neither Facebook nor Google accepts that characterization by the media companies.

In its submission, first reported by MLex last week, Facebook argues that its platform helped publishers monetize their content by creating a landscape that the media players could use to their advantage.

“We are committed to supporting a healthy news media ecosystem in which journalism thrives and media publishers are successful,” Facebook’s submission says.

Google’s defense of its role as an impartial vehicle linking readers to news outlets was just as sanguine.

“We don’t force [users] to consume news content on our site; instead, we send those users to those publications across Australia, where they will consume that news on the publication’s site,” Google Australia’s Jason Pellegrino said last week.

But the platforms’ arguments appear to be falling on deaf ears — largely because the publishers see Facebook and Google’s lack of transparency in their use of algorithms as something in desperate need of regulatory oversight.

Indeed, as far as News Corp. is concerned, the ACCC's inquiry needs to move the conversation towards regulation — regulation that could culminate in the establishment of a new body.

“Some further legislative, regulatory and/or policy intervention or changes are required to address the negative impacts of the platforms on news and journalism, such as establishing an Algorithm Review Board to analyze and remedy algorithmic distortions of competition,” the News Corp. submission says.

The new board could “designate the digital platforms as publishers/broadcasters to remove their incentives to distribute lower quality content,” the publisher says.

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