Meta lashes Labor’s news incentive in fiery blog post
Updated ,first published
Meta has launched a scathing attack on the Albanian government’s plan to force the world’s biggest tech companies to fund Australian journalism, branding the proposed regime a “discriminatory tax built on a false premise” that would leave the media industry dependent on government handouts.
In a formal presentation and accompanied by blog post The company, which owns the Facebook, Instagram, WhatsApp and Quest virtual reality headsets, said in a news release published overnight that it “strongly opposes” the News Bargaining Incentive designed to force Meta, Google and TikTok into striking commercial deals with news publishers.
“Our position is clear: this legislation is ill-conceived, grossly unfair, and will fail to deliver a diverse and sustainable news industry,” the company wrote. “Call it what it is: a discriminatory, retroactive tax targeting a handful of foreign companies, while competitors providing similar services face no equivalent liability.”
The incentive, backed by Prime Minister Anthony Albanese, would impose a 2.25 per cent fee on the three platforms’ combined revenue in Australia, with the revenues going to businesses that employ journalists. Companies can offset this fee by signing tax-deductible agreements worth about 1.5 percent of their revenue. The Treasury estimates the policy will boost local media between $200 million and $250 million a year, and the government wants it to be enacted this winter.
Meta’s main objection is the breadth of the tax, which covers “consolidated income attributable to Australia”. This designation boosts sales of Quest devices and other products that the company says have nothing to do with the news. The company argued that its claim to extract money from social media, where publishers voluntarily share their content, was not supported by evidence and that extending this logic to virtual reality headsets and smart glasses was “indefensible.”
Asked about the repercussions of the US administration during the announcement of the incentive, Albanese said: “We are a sovereign nation and my government will make decisions based on Australia’s national interests.”
It’s a familiar battle: Meta withdrew from deals it made under the original 2021 News Media Bargaining Code in March 2024, arguing that the news held little commercial value for Facebook. The incentive was clearly designed to close the loophole that allowed it to do this, and the fee now applies regardless of whether the platform carries news or not.
When Canada passed similar laws in August 2023, Facebook decided to block news entirely rather than comply. The company claimed that the number of daily and monthly active users on Facebook increased after the move, and the time spent on the platform continued to increase. He pointed to a broader shift in the way people consume content, noting that short-form video now drives the bulk of activity, with Reels generating 140 billion daily views and video accounting for more than 60 percent of time spent on Facebook and Instagram. Meta argues that its users come for creators and entertainment, not news.
The company also invoked trade law in its submission, arguing that the scheme violated the Australia-United States Free Trade Agreement by providing American companies with “no less favorable” treatment than their domestic counterparts. This theme was echoed by US business lobby groups, with the White House describing the policy as “foreign blackmail”, although it has not yet implemented retaliatory measures.
Australian media moguls strongly supported this plan. When it was announced in April, the heads of Nine, which owns this imprint, the ABC, News Corp, Network Ten, SBS, Southern Cross Media, Australian Community Media and Guardian Australia said the future of Australian journalism was at stake.
“The vitality of Australian democracy depends on the robust and open exchange of news, views and ideas,” the group said. “This is under threat.”
Google, which continues to honor and re-sign existing deals covering more than 90 news businesses, faces a potential liability of around $202.5 million annually if it refuses to make the deals, compared to $33.75 million for Meta and $16.9 million for TikTok.
Industry lobby group FreeTV has called on the Treasury to widen the net to include Microsoft and Apple, while a separate regulation for Microsoft’s LinkedIn, which runs its own editorial team and news tab, has irritated the platforms already covered. Former ACCC chairman Rod Sims, who drafted the 2021 legislation, described the apparent exclusion as “bizarre”. He warned that “the urgency is enormous” as existing agreements expire within a few months.
with Nick Newling
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David Swan is the technology editor of The Age and The Sydney Morning Herald. He was previously technology editor of The Australian newspaper.Connect with: X or email.
