Bonus Episode: Facebook Defriends Australia. What’s up with that?

Adam Keily: [00:00:53] Hello and welcome to a very special comedian versus economist, we demystify the world of money and help you get a handle on the bigger picture. My name's Adam and I'm joined, as always by my little older brother and real life economist, Thomas. Welcome, Thomas. [00:01:07][14.3]

Thomas Keily: [00:01:08] Adam, how are you doing? [00:01:08][0.4]

Adam Keily: [00:01:09] I'm very good, thank you. Big news today. We've got it all for you here. So we are launching a little new a new little segment called [00:01:17][7.9]

Adam Keily: [00:01:19] The Tight Five. Something interesting's happened. We're going to tell you about it. Five. [00:01:24][5.5]

Adam Keily: [00:01:28] I really hope that our production team who are amazing. Yeah. [00:01:33][5.3]

Thomas Keily: [00:01:33] And is going to Sasha is going to fix it in post season edition. [00:01:36][3.1]

Adam Keily: [00:01:39] All right. Well, look, huge news today with Facebook pulling the pin on news in Australia. That means that Facebook has now banned all Australian news sites from their platform and banned Australians from accessing any news, including international news content. And, Thomas, at the risk of paying you a compliment. I think you might have actually predicted this in your in our megatrends episode that we did earlier in the year, where you pulled out five megatrends that were going to happen in 2021. [00:02:10][30.8]

Thomas Keily: [00:02:12] Yeah, I'm calling I'm not sure if it was there or if it was when I went on equity markets and was talking about on The Cosby Show you [00:02:18][6.5]

Adam Keily: [00:02:19] your media, your little media [00:02:20][1.0]

Thomas Keily: [00:02:20] tart getting around. No, I can't remember which one it was. And it was one of them. Oh, no. I was saying Google GOOG was going to leave Australia. I reckon I can't see them working with the digital bargaining code. Um, yeah, but Facebook's beaten to the punch. Um, so I'm calling that a partial partial win. [00:02:38][17.9]

Adam Keily: [00:02:39] A partial correct prediction. A bold prediction, so. Well, that's a good point. So Google ah. Google are staying Facebook seemingly and leaving Google. Google have taken some strides to um to actually cement their place a little bit. They've gone the other way. They've done deals with seven West Media. They've done deals with Channel Nine. I think today announced a deal as well. So they're staying. [00:03:02][23.4]

Thomas Keily: [00:03:04] Yeah. I mean, this is what's sort of fascinating about it for me is you look at the government was trying to broker represent the media companies by getting them all on the same page and then going up against Google and Facebook together. And the media companies haven't doesn't seem like they've been able to hold it together, hold a consistent line. Nine signed a deal with Google, which, from the way they're reporting, it seems to forfeit their right to participate in the bargaining code if it came into effect. So saying like, yeah, we'll take the money now, which is that maybe they saw the writing on the wall. Maybe they knew it wasn't going to work, that Google was going to call the government's bluff on it. So they were like, okay, just give us the cash and we'll shut up. But, you know, like a Kerry Packer, I can imagine looking at nine are going like, oh, come on, guys. We were in the fight together here. Like, you know, it's going to take the money and run now. You know, [00:03:54][50.2]

Adam Keily: [00:03:55] we're like, yeah, we, of course, did dove into this in a whole lot more detail in an episode a couple of weeks ago where we were talking about Google's threat to pull search from Australia. This was prior to all the deals being done with news media outlets in Australia. So if you haven't heard that episode yet, go back. I think it's not last week, the week before. Sorry. So go and check that one out and hear everything. We had to it was had to say on Google V, the Australian government. But it's all about Facebook today and Facebook throwing down the gantlet really and banning all of Australian new sites and Australians in general from accessing the Internet, fair to say, didn't go smoothly. [00:04:36][41.4]

Thomas Keily: [00:04:37] No, I don't think you call that a smooth rollout. [00:04:39][2.0]

Adam Keily: [00:04:42] You know, there is many and varied array of sites that were taken offline. Facebook, just to continue their audacity, have not taken any responsibility. They've blamed the government, saying that it's the government's definition in the legislation that was too vague. And we talked about that on our site about Google saying that, what was it, 100000, [00:05:07][25.1]

Thomas Keily: [00:05:08] 150000 revenue, not even profit hungry for the revenue. I mean, are we still up? We should check. [00:05:13][5.5]

Adam Keily: [00:05:15] Well, that's why we're posting a new podcast instead of some content on Facebook, because no one can see it anymore. So, yeah, Google said that as the law does not provide clear guidance on the definition of news content, we have taken a broad definition in order to respect the law as drafted. So it's all about respect, which is nice, but I feel that that's good. [00:05:35][19.9]

Thomas Keily: [00:05:35] Yeah, but I say it's so maybe it's so it wasn't because I was looking at all these shite sites getting shut down. I'm sure sites like mine and news sites, um, getting getting shut down and like oh I love really Mufti's. I'm like, how do they move something so big. You shut. Down news and in in one nation, the whole world is watching as everyone wants to know what's going on Heidi. Murfitt so bad. But you're saying it's deliberate, like maybe it's like, you know, this is this is where we're going, folks. None of you got Facebook pages. [00:06:04][28.4]

Adam Keily: [00:06:06] Well, yeah, maybe. But it's not just the little news sites. They've blocked the Bureau of Meteorology also because you can't have news without the weather. Right. So news and where they go hand in hand, the weather is going to go first. First cab off the rank. They blocked the affordable. You saw it. So because, of course, you can't have news without sport and weather. So sports got to go. Um, they even included the Quidditch Australia Facebook page, which, you know what it is. It's the sport they play in Harry Potter that got banned. Um, slightly more seriously. [00:06:45][39.4]

Adam Keily: [00:06:46] They banned the essay Health, Queensland Health and Fire and Rescue New South Wales. Right. Which is bad is bad at the best of times. Probably not ideal when it's bushfire season during a pandemic fire and rescue and state health pages. So the fire. Yes, is going to be. [00:07:07][21.0]

Thomas Keily: [00:07:08] I mean, I live in I live in a rural area where people really tune into the rural fire services page when there's fires about like people are watching that closely. Like that's a oh, yeah, yeah. [00:07:21][12.5]

Adam Keily: [00:07:23] This is why the Facebook is coping so much, I think from, um, from everyone from all corners for their actions. Because, I mean, I don't know, I I've worked in a few organizations, and change management is pretty key to a lot of what you do in your production environment. And I feel like they may be rushed this one just a little bit. [00:07:45][22.0]

Thomas Keily: [00:07:45] That's what it feels like, doesn't it? Like I logged on to Facebook today and then got a prompt saying like you're no longer able to see news click this link to understand why that takes you through to a webpage. And then it's just this long letter or it's like why you can no longer share or see news on Facebook in Australia. And then it's like one of these like like thirteen paragraphs like this. We speak in a green font. I'm like, who's reading this man? Like give me a cat talking about it or something. Like we get three points like that. No one's got time for this. Let's like this. There's no you know, this is not how you run a public media campaign. I don't think or like. [00:08:28][42.5]

Adam Keily: [00:08:29] It sounds to me that's out that page itself sounds a lot like news, which is one which is possibly how it led Facebook to accidentally block Facebook's own page. Did you say that Facebook, they blocked themselves? Well, obviously, they have just let the chaos monkey see everyday. They've just gone. Just gone. [00:08:53][24.3]

Adam Keily: [00:08:53] He's a he's a man. He's a he's an algorithm that we've knocked up overnight. Let's give it to the chaos monkey and let him run around and shut down whatever he thinks is sensible as a news site. So Facebook have ended up blocking their own site and apparently Facebook is taking it up with Facebook. I'm not sure how that works. Oh, no. [00:09:15][22.3]

Thomas Keily: [00:09:16] I've got to go through the dispute resolution process. That's going to take a minute. They can wait,. [00:09:21][4.8]

Adam Keily: [00:09:22] Zuckerberg said, to submit a request. There is a lot that we could oh, um, the other one that was interesting, though, is that after all the talk during the US election and all the talk for four years, the whole of Donald Trump's presidency about fake news and blocking fake news, we've got to get rid of fake news and everything is fake news. Facebook actually did it today. They blocked the Betoota Advocate, The Chaser show. Those guys are going to be cheering like they always want to be mistaken for actual news. So I've never been included by Facebook's news monkey. [00:10:06][44.0]

Thomas Keily: [00:10:06] Oh, I love those guys. Oh, no. [00:10:08][1.5]

Adam Keily: [00:10:13] it's all kicking off. So, I mean, what's happening in the economic space? Is it is this is it too early to say? Is Facebook's share price going to take a hit because of this? Or what do you reckon? [00:10:22][9.5]

Thomas Keily: [00:10:22] Oh, I think I think I think it it's a demonstration of market power. Like I think they're sort of just grabbing their nuts and have got to look at this like. [00:10:31][9.0]

Thomas Keily: [00:10:34] So, you know, what I reckon, you know, is [00:10:37][3.1]

Thomas Keily: [00:10:37] this like the market is okay, right? Yep. Little nations, you know, we're not little we're in a major economy and get to chair the G20 every few years. [00:10:47][9.8]

Adam Keily: [00:10:48] And when they say it's our turn. [00:10:50][2.4]

Thomas Keily: [00:10:52] Yeah, so, you know, so we've, you know, tried it out and Facebook was going, you know, we're not having it. I mean, like I think there is an argument that the legislation, the code was a bit unworkable. But it's also I think they're like, yeah, and we're just not playing with this and this thing. I haven't waited for the code to be implemented. It's like it's a shot across the bow in the sense of like, you know, this if this is where we are, we're going. This is what's going to happen. And this is our hand. [00:11:17][25.3]

Adam Keily: [00:11:18] Um, they also Facebook and we talked about this in the episode a couple of weeks ago. Facebook also said that they don't see any value in news content. They said there's no commercial value for them. So in that sense, they share price and everything else shouldn't be affected at all because they haven't lost anything. [00:11:35][16.8]

Thomas Keily: [00:11:35] Yeah, I would I would be really interested to see how much of Google of Facebook content on a given day in Australia is news comes from a news outlet like I would imagine it's vanishingly small. Hmm. Like maybe like when you get that broad brush that the chaos monkey's gone with you, you get a lot more. But if we're just talking nine and seven and. Yeah, Packer like is this is not I just don't see news articles from those places very often. Maybe that's my feed. [00:12:04][28.5]

Adam Keily: [00:12:04] But yeah, I can send you a link to the Sunrise page if you like. You can get, some news there. [00:12:11][6.5]

Thomas Keily: [00:12:13] Um yeah. So yeah I don't see it as a negative for Facebook. I think they had to go this way anyway. Yeah. [00:12:20][6.4]

Adam Keily: [00:12:21] So they're not going to take it. So you reckon they're, they're going into this kind of risk free from a commercial side. They're not expecting really to take a hit. Their platforms are not going to suffer because of it. People. People yeah. We've got such a short attention span generally these days. People all just kind of go, wow, I get news on Facebook anymore. I guess I'll just install the ABC app. [00:12:40][20.0]

Thomas Keily: [00:12:41] Yeah, yeah, I think so. And I think it's also like I think Google and Facebook are a bit like, come on guys, like we're directing traffic to your site. That's what we're doing here. Like, if you're not able to monetize the traffic that we're sending you, that's on you guys like that's not us. And let's see how you go. If we're not sending traffic your way, if Google and Facebook stop sending traffic your way, see how you go and. [00:13:05][24.5]

Adam Keily: [00:13:06] Yeah, yeah, I think the big sticking point for and looking at my Facebook feed today, a lot of the commentary was around, you know, the little guys getting caught up in all this. I think I saw some post today from a guy here in Adelaide, Craig Egan, who runs Adelaide comedy. You know, some of his stuff has been caught up in all of this kind of Facebook, not paying for content and everything else. And so you just hope that there's I don't know that maybe at least the government legislation goes, well, let's raise the bar a bit. Let's maybe not make it one hundred and fifty K in revenue per year. Let's make it something that's going to target the big outlets and not punish people who are just trying to get some messaging out, like maybe say, hell no. [00:13:48][41.7]

Adam Keily: [00:13:50] So, you know, [00:13:51][1.1]

Adam Keily: [00:13:53] that's my hope as well I think should happen, but [00:13:55][2.0]

Thomas Keily: [00:13:56] maybe we'll get better legislation at the end of it. Maybe this is democracy in action. [00:14:00][3.3]

Adam Keily: [00:14:01] Yeah, that's it. And I mean, you know, Facebook is speaking with the platform that they own and they control and they're gone. Well, we don't agree. And that's what we're going to do. So now it's your turn. The Australian government, which is good. I feel like we're in good hands because Scott Morrison today came out with some pretty strong words. He said that these were actions to unfriend Australia [00:14:24][23.6]

Adam Keily: [00:14:26] show showing just how hip with the kids got it from marketing. [00:14:30][4.1]

Thomas Keily: [00:14:30] It's like he's kind of like if you Google [00:14:34][3.3]

Thomas Keily: [00:14:35] image search for a guy who's just been defriended, [00:14:38][3.0]

Thomas Keily: [00:14:39] you get Scott Morrison like it is the kind of comment from someone who has never used Facebook, Oregon. Well, that is going, oh, we're going to have a set. We've got to have a comment about this Facebook thing. What does Facebook do? [00:14:54][14.6]

Adam Keily: [00:14:54] Well, you've got friends and you can kind of you can add friends and unfriend them. Right? [00:14:59][4.3]

Adam Keily: [00:14:59] I've got it. So the analogy here is we've been unfriended. Got it. I'm leaving with that. [00:15:06][6.8]

Thomas Keily: [00:15:07] Yeah. But as such, it's such a it's something that Trump never would have said because you unfriend the nerdy, annoying character. [00:15:15][7.8]

Adam Keily: [00:15:16] Trump would have unfriended face. [00:15:18][1.9]

Adam Keily: [00:15:19] It would have turned it around straight away and gone. I kicked them out. They were bad. They were doing naughty things to our country. They were ruining democracy. So I've banned them. Um, they will not be participating in in in our country anymore. Exactly where is [00:15:35][16.7]

Adam Keily: [00:15:36] this guy is being confronted with the Zoidberg again, sending inappropriate pics or something or whatever. What do we do to get unfriended? Was it this, is it just the beginning thing? [00:15:48][11.4]

Adam Keily: [00:15:48] Are, um, so big day. I'm glad we're able to find some time to cover it off, hopefully, that's brought you up to speed a little bit on what's happening with Facebook and their blocking of news. If you want to know some more about the details of the proposed legislation and the proposed code, and you haven't listened to the episode from a couple of weeks ago, then please go and find that out, please. Kate, listening to comedian versus economist, if you've got any questions or comments, obviously you can't get on the Facebook page anymore. We didn't have one spoiler alert, but you can always email us cve@equitymates.com Or go to the website, equitymates.com/cve and use the content form there. So thank you, Thomas, for your insight. [00:16:36][48.4]

Thomas Keily: [00:16:37] Thank you. [00:16:37][0.0]

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