Rupert Murdoch to Mark Zuckerberg: Shut Up, Pay Me
How do you stop Facebook and Google from taking over the digital media universe? If you’re News Corp chairman Rupert Murdoch, the answer is simple: make big tech companies pay news outlets for the content that has made them billions. “If Facebook wants to recognize ‘trusted’ publishers then it should pay those publishers a carriage fee similar to the model adopted by cable companies,” Murdoch wrote in a statement Monday. “The publishers are obviously enhancing the value and integrity of Facebook through their news and content, but are not being adequately rewarded for those services.”
Murdoch may be in traction, but he’s evidently still in fighting spirit. Last month, the mogul made a major concession to Silicon Valley’s rise when he announced that he would be selling 21st Century Fox’s film and television assets to Disney, a $52.4 billion deal that was widely interpreted as an acknowledgement that his media empire couldn’t compete with digital upstarts like Netflix and Amazon. With Facebook and Google suddenly looking politically vulnerable, however, he made the case on Monday that tech platforms should begin making payments to content creators—something that “would have a minor impact on Facebook’s profits but a major impact on the prospects for publishers and journalists.”
So-called carriage fees aren’t a new idea: they’re what cable and satellite providers currently pay local broadcast channels for rights to carry local transmissions on their networks, dating back to a 1992 agreement under the United States Cable Television Consumer Protection and Competition Act. Nor is this a new idea for Murdoch. In 2009, News Corp threatened to take all of its content off of Google and exclusively host it on Bing. Tech companies, Murdoch said at the time, “steal our stories.”
Murdoch is banging his drum now opportunistically. Facebook has taken the significant heat in recent months for its role in the spread of misinformation, particularly during the 2016 election. Last week, in response to scrutiny from legislators and criticism from users, Facebook C.E.O. Mark Zuckerberg announced that the site’s News Feed will prioritize posts from friends and family over stories from publishers. Publishers that have become dependent on Facebook traffic are bracing for the worst, amplifying concerns in Washington that Facebook, among other tech platforms, has become too powerful. (Just ask the once-booming Upworthy about its abusive relationship with Facebook’s algorithm.) Media companies have frequently complained that they have little bargaining power over Silicon Valley, which controls a growing percentage of the news that Americans see. But while individual news organizations can’t force Facebook’s hand, lawmakers and regulators could.
For the U.S. tech industry, such an arrangement would be unprecedented. But it’s not unfamiliar to telecoms, and European regulators are already weighing similar moves. Proposals to force digital platforms like Google, Facebook, and LinkedIn to compensate publishers for their content are proceeding, in fits and starts, in Europe, and stateside, similar ideas are picking up speed. In limiting the scope of its news-sharing operations, Facebook was attempting in part to shirk the responsibilities of a media company—a role its executives had argued for months that it never intended to play. But in choosing to exercise discretion in disseminating news, after all, the tech giant may have inadvertently relinquished some of its leverage.