Last year, the Australian government presented Google and Facebook with an ultimatum: if the companies wanted to continue to allow users to link to news articles, they would be required to compensate news organizations. The Australian plan called for the creation of a mandated code that would create a process to determine the price to be paid for the links. Facebook’s response made it clear that if that was the choice – links with mandated payments or no links – it would choose the latter and block Australian news sharing from its service. While some described this as a threat (including Canadian Heritage Minister Steven Guilbeault) or a bluff, it turns out the company was serious.

I have previously written that there is much to criticize about Facebook, but I don’t think that complying with the Australian legal framework by choosing to stop linking to news articles is one of them. Notwithstanding condemnations from the officials such as Guilbeault, the reality is that Facebook doesn’t post full articles and the only links that appear are those submitted by its users. It maintains that news article sharing simply isn’t a significant part of its service, noting that it only constitutes four percent of content and that the vast majority of users will not be significantly affected. Further, it argues that the links to the news articles were already worth hundreds of millions to publishers (all provided at no cost) and that further payments are unnecessary. As I’ve noted in examinations of the social media practices at the Toronto Star and Postmedia, both organizations regularly post the majority of their articles directly on Facebook, presumably because they benefit from increased traffic and advertising revenue.

Indeed, while politicians such as Bloc MP Martin Champoux tell the House of Commons that “if journalists didn’t work so hard, there would be nothing to share on social media. There would be no Facebook, or Google, or Twitter”, Facebook’s actual data suggests this simply isn’t the case and the articles obviously remain online at their original source. The social media giant has certainly captured a big slice of the digital advertising market, but that ultimately has very little to do with the availability of news articles on its site.

My initial view is therefore that Facebook’s approach is an understandable response to government policy. In fact, governments enact policies all the time – particularly tax policies – with the expectation that companies will respond. For example, lower tax policies may be designed to encourage investment, while higher taxes are recognized as risking reduced investment or corporate flight. That doesn’t make those policies right or wrong, but it does mean that there are consequences to policy decisions. Australia decided it wanted to force Facebook to pay a licence fee if it featured links. Facebook simply responded that they would no longer offer the links. Hardly the stuff worthy of condemnation.

As I said to Reuters, there are no winners in this situation – media organizations lose traffic and revenue, Facebook downgrades the value of its service to at least some of its users, and the risk of greater dissemination of low-value information increases. But the bigger picture is that this incident points to several potential unintended consequences that should not be overlooked.

First, it provides an important reminder of the risk of content over-blocking that comes from government creating liability for content posted by users. In this case, the liability is financial liability, but the principle is the same: create a framework where companies will block content and more than you think will be blocked. Facebook’s implementation of the news sharing block has troublingly resulted in the blocking of non-news stories too, including government information, weather, and non-profit organization pages. This is presumably what Guilbeault calls “highly irresponsible”, even though the inadvertently blocked sites are still available online since the Internet is more than just Facebook. Indeed, if governments think their only way of communicating important issues such as vaccination information is through Facebook that is a bigger issue in need of addressing (and for which the blocking may be a blessing in disguise).

Facebook says this was a mistake and that it is working to fix the over-blocking. Yet this should not come as a surprise. It isn’t that Facebook is particularly bad at content blocking, it is that experience suggests that blocking mandates invariably result in blocking good content alongside the bad. Over-blocking occurred years ago when Telus tried to block a single website and instead blocked hundreds in a well-known net neutrality violation, it arises when governments use copyright to require website blocking (as was raised during Bell’s proposed site blocking system), and it is a consequence of creating liability for third party content that pressures sites to proactively remove content. There is unquestionably a need to ensure that sites remove illegal content, but the calls to eliminate safe harbour rules for Internet sites bring an unintended consequence that will likely result in legal content being blocked alongside illegal content.

Second, I fear this could further push government to treat the Internet – or at least large Internet services – as the equivalent to cable television with legislated content mandates. The Canadian government is already racing to establish legal requirements to block content with Guilbeault going so far as to suggest that it could even include “hurtful” comments. In other words, the blocking requirements may well extend beyond unlawful content into what many are describing as “lawful but awful” content. Further, this incident points to the possibility of mandated carriage requirements as well. Much like cable television, could the government use the CRTC to require Facebook to feature links to  Canadian content (and then pay for the privilege of linking to that content)? In an escalating battle between governments and the Internet companies, it seems like a distinct possibility.

Third, this incident provides an important reminder that independent and smaller media will bear the biggest brunt of these policies. The reality is that the Australian battle really pits Facebook against Rupert Murdoch’s media empire. In other words, giant vs. giant. In Canada, the large media companies such as Postmedia and Torstar are the most vocal lobbyists on this issue, but smaller, independent media have already indicated that they do not support the News Media Canada lobbying campaign and want the benefit of links from social media services.

Guilbeault has seemingly been relishing the chance to battle the “web giants.” This week he even indicated that market-based solutions were unacceptable, warning that companies could change their minds years later. That will be news to Canadian services such as Village Media, which has already reached agreement with Google as part of its Showcase product. The larger ones are holding off striking deals, presumably on the basis that they hope that Guilbeault will legislate a better deal. But if the government follows through with its legislated plans, it could create enormous harm for independent Canadian media.

It is remarkable to see a government minister suggest that Canada needs to legislate licences for linking because an Internet company might not voluntarily enter into a licence agreement sometime in the future. That kind of “government knows best” may seem like a political winner today, but as this week’s events remind us, it also brings the prospect of content over-blocking, harm to independent media, and Canadians losing access to services they value because a government prioritized scoring political points over good policy.

The post Beware the Unintended Consequences: Some Warning Signs for Canada from the Australian Government Battle With Facebook appeared first on Michael Geist.