Media giants unite to deceive in Google, Facebook cash grab

ACCC chairman Rod Sims says "the world is watching" Australia as the media code makes an impact even before passing into law.

ACCC chairman Rod Sims says "the world is watching" Australia as the media code makes an impact even before passing into law.

Any day now, Telstra will cuddle up to the federal government seeking to have legislation to force eBay to compensate the phone company for the $630 million it lost on Trading Post.

That will be followed by Blockbuster and smaller rental outfits wanting Scott Morrison to go Netflix, Foxtel and Stan for what they did to the local video store.

Foxtel – no stranger to getting money in dubious circumstances from this government – will want laws to force Netflix, Stan, iView and SBS On Demand to pay up for “stealing” Foxtel subscribers. (A holding operation pending the Murdoch myrmidons’ preferred course of having the ABC and SBS exterminated or at least sold off.)

Old Rupert Murdoch himself is next in line to have the Prime Minister recover from Facebook the $710 million he lost on MySpace. (Anyone remember MySpace?)

Four absurd cases – but they are actually less absurd than the government’s current legislation to force Google and Facebook to compensate select advertising media for the fact that Google and Facebook are better at selling ads than they are.

The four silly examples are at least straight forward – better mousetraps take the money, old mouse-trappers want some of it back. 

The main protagonists in the present Government and MSM v Google and Facebook battle are pretending it’s not about mousetrap compensation, but the cheese business.

Rupert Murdoch Google

Rupert Murdoch’s News Corp is accusing Google of stealing its revenue. Photo: Getty/TND

The MSM, predominantly Murdoch and Nine Entertainment with assistance from Guardian Australia, are pretending it’s about the journalism business, pretending Google and Facebook are “stealing” their journalism – when it’s really about the advertising.

It’s what Crikey’s Bernard Keane last August termed The great Google-Facebook heist – the sovereign risk that dares not speak its name.    

It is ironic that the government and its cheer squad are now claiming there’s a sovereignty issue in Google’s opposition to the scheme.

Showing a mixture of tribalism and self-interest, Murdoch journalists and those employed on the papers-formerly-known-as-Fairfax are campaigning hard. Mr Keane has again belled it, Media abandons balance in pursuit of Google’s billions. 

That was published just before the Sydney Morning Herald’s political and international editor, Peter Hartcher, demonstrated the point with perhaps the most tortured feature he’s ever written, Spare us the Google-eyed crackpots: the case for a viable news business.

In many, many words, Mr Hartcher ran through the genuine evils of social media conspiracies and “fake news”, rambled into Craig Kelly’s ratbaggery and Scott Morrison’s feeble response, and then jumped to the conclusion that “Australia finds itself at the forefront of trying to stamp its authority over the digital world” with the Morrison government’s digital media bargaining code to “make the US-based multinationals pay Australian professional media outlets for using their news”.

Astoundingly for a senior journalist, he then claims:

Thus far, the Big Tech firms simply distribute the local media companies’ news to the users of Google or Facebook.”

Anyone who uses Google – and that’s 99 per cent of us – knows that is not true.

Predominantly, a Google search provides the link to stories on the media companies’ web sites. Whether those sites are paywalled is up to the companies’ business model. If someone clicks through to the site, the media company has the opportunity to present advertising before the customer’s eyeballs and gain revenue.

Yes, it’s more complicated than that and how Google and Facebook target information, twist searches, control advertising and harvest and use customers’ data is appalling. That could do with genuine government action including some Teddy Roosevelt-scale trust busting.

And the tech giants’ ability to avoid taxation is equally appalling. It would be more legitimate for the government to do its job of collecting all the tax that should be collected and then, if the case for journalism as a public good is made, subsidising it.

But that would stray into matters way too difficult and dangerous. Who would want the government to decide what journalism deserved supporting, especially this government of media mates that’s persecuting the ABC?

So the government is running with a lie instead. Bernard Keane:

“The code is justified by a News Corp lie, that Google steals news content and makes billions of dollars from it. The ACCC forensically compiled evidence that this was false. Knowing that the News Corp claim was wrong didn’t prevent Treasurer Josh Frydenberg from spreading it himself.”

The most astounding aspect of the Murdoch and Nine campaign is the hypocrisy.

Yes, journalism and other industries are in trouble because they’ve lost advertising revenue, some of it because more efficient disruptors came along, some of it because of incompetent management, some of it because management chose to sell it off. 

I don’t remember Mr Hartcher or anyone else in a Fairfax organ ringing the alarm bell about lost advertising revenue when the company decided to sell off 40 per cent of its Domain real estate advertising business.

Similarly, the Fairfax decision to reject an offer to get in on the Seek ground floor cost it billions when Seek proceeded to “steal” Fairfax’s job ads revenue. I wonder if Nine will now seek compensation from Seek?

Perhaps Nine will also seek compensation from News Corp as its subsidiary, REA, “stole” the biggest slice of the real estate ad business after Murdoch did with REA and real estate what the old Fairfax didn’t do with Seek and job ads.

Real estate agents have possibly broken the law by encouraging renters to draw down on their super.

Real estate advertising has seen a tug of war between the big outlets. Photo: Getty/TND

News paid $10.25 million for 44 per cent of REA 20 years ago. Over the years it has crept that stake up to 61.6 per cent, a stake now worth $13 billion, accounting for most of News Corp’s value.

Maybe Nine and News Corp can both go after, which “stole” the best of the car ads.

Another form of hypocrisy was on display from Guardian Australia’s managing director, Dan Stinton, when the Nine mastheads ran his pro-code opinion.

“In an effort to mitigate the impact of updates to these opaque algorithms, the code requires that the digital platforms give at least 14 days’ notice to publishers of material changes which will impact on the traffic we receive,” Mr Stinton said.

Yes, the newspapers want advance notice of the evil tech giants’ distorting algorithms that game customers so the newspapers can play the distortion game themselves in internet searches.

Michael Miller, Australasian executive chairman of Rupert Murdoch’s News Corp, has claimed the tech mobs should pay Australian media companies much more than Nine chairman Peter Costello’s estimate of $600 million dollars every year.

That’s more than a little rich if this whole money grab is supposed to be about public interest journalism.

Former media analyst turned fund manager, Mike Mangan, didn’t hold back in reaction to Rupert Murdoch’s speech upon receiving a lifetime achievement award from the UK Australia Day Foundation.

Mr Mangan and the Murdoch empire have history. In the former’s media analyst days, there were two occasions when he thought News Corp shares were overvalued and he therefore posted a “sell” signal. It cost him his job when the weight of the empire was brought to bear. 

So when Rupert Murdoch said:

“For those of us in media there’s a real challenge to confront: a wave of censorship that seeks to silence conversation, to stifle debate,to ultimately stop individuals and societies from realising their potential. This rigidly enforced conformity, aided and abetted by so-called social media, is a straitjacket on sensibility…”

Mr Mangan wrote in his Monday newsletter:

I’m sorry but this is total BS. ‘Cancel culture’ is Murdoch’s very raison d’etre.

Across the last 70 years not a week, maybe not a day, has gone by without his media outlets demanding someone, somewhere be fired.

The indiscretions triggering such demands could be real or imagined. Or just convenient.

When fired ‘News of the World’ editor Greg Miskiw was asked what his job description had been, he simply replied: “destroy other people’s lives”.

I’ve heard his sycophants chuckle over whether a media public company CEO had a mortgage or not. The CEO was not playing their game and had to go.

‘Cancel culture’ Murdoch style. He spent a lifetime destroying commercial competitors – all legal mind you.

Job (largely) complete, he’s moved on to cancelling public broadcasters.

The first thing you learn from dealing with folks like Rupe et al, is that what they say is meaningless. Their ‘skill’ is their ability to spin self-serving drivel with such gravitas that they are widely believed.

Mr Mangan wrote more, but you get the drift.

Murdoch’s Australian newspapers are behind paywalls. Google searches send potential readers to those walls. To claim Google is stealing Murdoch journalism, is the aforementioned self-serving drivel – but facts don’t get in the way of a determined Murdoch campaign.

Google and the other supranational giants should be forced to pay the right amount of tax, not have a dodgy (and technically convoluted) code imposed to primarily benefit News Corp and Nine Entertainment shareholders.

P.S. That seems to be pretty much the same conclusion Paul Barry came to on Media Watch on Monday night. 

Disclosure: The New Daily is one of the publishers that are part of Google Showcase, Google’s preferred method of paying some money for journalism.

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