News Corp strikes with Facebook in Australia and resolves dispute that led to blackout

Rupert Murdoch’s News Corp. reached a content agreement with Facebook Inc in Australia, the companies said on Tuesday, a step towards resolving a dispute that saw the social media giant briefly shut down thousands of pages in the country.

The deal, whose terms were not disclosed, makes News Corp the first major media outlet to strike a Facebook deal under controversial new laws that allow an Australian government-appointed arbitrator to set fees if companies do not.

Facebook shuts down all media content in the country for a week last month outraged world leaders, as the blackout included rescue services and state health sites. It ended the shutdown when Australia agreed to soften certain parts of the new rules.

News Corp, which owns about two-thirds of Australian metropolitan newspapers, was among media companies urging the government to let Facebook and Alphabet Inc’s Google pay for media links that drive viewers and advertise dollars to their platforms.

Google had also objected for several months and threatened, like Facebook, to withdraw core services from the country, before signing deals with most media outlets – including News Corp – the days before the rules became law.

“The agreement with Facebook is a landmark for changing the terms of trade for journalism and will have a significant and meaningful impact on our Australian news outlets,” said News Corps CEO Robert Thomson in a statement thanking the Australian Prime Minister, Chief Antitrust Adviser.

“This digital abolition has been more than a decade in the beginning,” Thomson added.

Facebook’s head of news partnerships in Australia, Andrew Hunter, said the deal meant that Facebook’s 17 million users in the country “will have access to premium news articles and news videos from News Corp’s network of national, metropolitan, rural and suburban newsrooms”.

In addition to the country’s best-selling tabloids The Daily Telegraph in Sydney and The Herald-Sun in Melbourne, News runs a cable TV network called Sky News, which struck a separate Facebook deal whose terms were not disclosed, according to News Corp.

News Corp was the first to say it hit a Facebook deal, but free-to-air TV broadcaster and newspaper publisher Seven West Media Ltd has previously said it signed a letter of intent to do so.

On Tuesday, Seven rival Nine Entertainment Co Holdings Ltd reported in the Australian Financial Review that they had also signed a letter of intent for a Facebook deal.

A nine spokesman said the company, which also publishes the Sydney Morning Herald, “continues to have constructive and fruitful discussions with Facebook (and) when we have something to announce that we will do so”.

A spokesman on Facebook refused to comment on the nine negotiations.

(REUTERS)