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Josh Frydenberg slaps down Facebook after social media giant threatens to pull Australian news

Federal Treasurer Josh Frydenberg has slapped down Facebook for making “heavy handed threats” to lock Australian media out of its platforms if Government reforms to require the media giant to pay for content proceed.

Mr Frydenberg said the proposed reforms would make the media landscape fairer and were very much needed.

“Australia makes laws that advance our national interest. We don’t respond to coercion or heavy handed threats wherever they come from,” Mr Frydenberg told The West Australian.

“Our reforms to digital platforms are world leading and following a ground breaking 18 month inquiry by the ACCC.

“These reforms will help to create a more sustainable media landscape and see payment for original content.”

Facebook has warned it will ban news on its own platfom and on Instagram if forced to compensate media companies for publishing their stories.

Communications Minister Paul Fletcher said today’s announcement reminds us tech giants “have a history” of these types of moves.

“The Government’s policy objective is clear. We want to support a diverse, sustainable media sector in Australia,” he said.

But he said the Government would not be deterred “from our careful, thorough, fact-based public policy process”.

“The Government remains committed to the introduction of a mandatory code to address bargaining power imbalances between digital platforms and news media businesses,” Mr Fletcher said.

“The ACCC and Government will take account of feedback from all stakeholders including Facebook.

“The ACCC is presently preparing its final advice to Government following its consultation process and the Government looks forward to receiving and considering that advice.”

The Australian Competition and Consumer Commission labelled Facebook’s statement “ill-timed and misconceived”.

“The draft media bargaining code aims to ensure Australian news businesses, including independent, community and regional media, can get a seat at the table for fair negotiations with Facebook and Google,” a statement from the watchdog read.

“Facebook already pays some media for news content. The code simply aims to bring fairness and transparency to Facebook and Google’s relationships with Australian news media businesses.”

Facebook executive Will Easton said a code of conduct being pursued by the Australian government ignored the relationship between social media and news organisations, which he claimed would suffer most.

“Assuming this draft code becomes law, we will reluctantly stop allowing publishers and people in Australia from sharing local and international news on Facebook and Instagram,” he said in a statement on Tuesday.

“This is not our first choice – it is our last.

“But it is the only way to protect against an outcome that defies logic and will hurt, not help, the long-term vibrancy of Australia’s news and media sector.”

The threat follows similar warnings from Google, which claimed the proposed media bargaining laws could force it to offer Australian users “dramatically worse” Google Search and YouTube products.

Mr Easton said Facebook supported the Australian government’s goal of supporting struggling news organisations but its solution was counterproductive.

He argued the government wrongly assumed Facebook benefited most in its relationship with publishers, when the reverse was true.

Facebook sent Australian news websites 2.3 billion free “clicks” in the first five months of the year, driving traffic worth an estimated $200 million.

As well, Mr Easton claimed Facebook already invested million of dollars in Australian news and offered to invest even more, and proposed introducing a dedicated platform for local content.

“But these proposals were overlooked,” he said.

“Instead, we are left with a choice of either removing news entirely or accepting a system that lets publishers charge us for as much content as they want at a price with no clear limits.

“Unfortunately, no business can operate that way.”

Google has warned the proposed code could compromise the personal data of its Australian users and stymie their access to free services.

But the Australian Competition and Consumer Commission has questioned the internet search giant’s claims.

“Google will not be required to charge Australians for the use of its free services such as Google Search and YouTube, unless it chooses to do so,” ACCC chair Rod Sims said.

“Google will not be required to share any additional user data with Australian news businesses unless it chooses to do so.”

He said the code would allow Australian news businesses to negotiate fair payment for their journalists’ work.

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