I Am Rupert Murdoch's Total Lack Of Shame: Now Demanding Intermediary Liability Protections For News Corp.

from the hypocrisy dept

Let's talk a bit about Rupert Murdoch. To his slight credit, in the early 2000s, he seemed to realize that the internet would be big for media. He also realized that he might be missing out. He went on an internet buying spree. It got to the point where Newsweek was praising Murdoch's "smart bets" on the internet. The cornerstone of Murdoch's digital empire was MySpace; a site that was once so dominant, the media insisted that no one could ever surpass it -- not even a dumpy little startup like Facebook.

We all know how that all turned out. Within a few years, people realized that nearly every one of Murdoch's internet ventures was a total and complete flop (often embarrassingly so).

Since then, it has seemed that Murdoch has been at war with the internet. The man who spent years using his various media properties to insist that we needed "less" government, and more "free market" wasted no opportunity to demand that the government step in and regulate, breakup, or tax the internet companies which out innovated Murdoch's News Corp. He's even been occasionally successful in getting governments to burden his competitors with ridiculous regulations.

Over the last few years, Murdoch and News Corp. have been one of the leading voices attacking Section 230. Murdoch seems consistently angry at anything deemed good for the internet. News Corp. has been lobbying against Section 230. Fox News' most popular host, Tucker Carlson, regularly (if consistently ignorantly) rails against Section 230. Trump's attacks on Section 230 in 2020 were completely consistent with Murdoch's views.

That's why we found it grimly ironic last week when an Australian court ruled that media companies could now be held liable for 3rd party comments on social media. This was an upside down version of Section 230 Down Under, that reached way beyond social media sites being liable. Instead, it made the news organizations that posted links on social media liable for the comments that came under them.

I joked that perhaps Murdoch would finally realize why Section 230 was important, and it did not take long for News Corp. to demand that the law be changed to protect... organizations like News Corp. from some 3rd party liability:

The ruling was "significant for anyone who maintains a public social media page by finding they can be liable for comments posted by others on that page even when they are unaware of those comments," News Corp Australia executive chairman Michael Miller said in a statement.

"This highlights the need for urgent legislative reform and I call on Australia's attorneys general to address this anomaly and bring Australian law into line with comparable western democracies," Miller added.

You don't say? You mean, it might be helpful if there were some sort of law? One that made it clear that intermediaries and media organizations should not be held liable for comments from random commenters? Someone should tell Tucker Carlson...

Filed Under: australia, intermediary liability, michael miller, rupert murdoch
Companies: news corp.

As Predicted, Smaller Media Outlets Are Getting Screwed By Australia's Link Tax

from the exactly-as-we-warned dept

Ever since the giant news organizations, led by Rupert Murdoch's News Corp., began pushing the ridiculous idea of forcing Google and Facebook (and often just Google and Facebook) to pay a "link tax," we've been pointing out that while this might be a windfall of free money for the news giants, small news organizations (like, um, us) would likely get totally screwed over. With Australia leading the charge of silliness and passing its link tax, we're discovering that our predictions were exactly correct.

The big Australian publishers, News Corp. and NINE, are making out like bandits, while the smaller publications? Not so much.

A long-term commercial deal between Facebook and Google and Guardian Australia is expected to be completed in a matter of days, adding to a raft of agreements struck between large tech companies and major media outlets since February. While companies like Nine Entertainment Co, News Corp Australia and Seven West Media are already implementing plans off the back of the deals, there is increasing concern among smaller companies that they still have not been remunerated fairly.

Of course, this isn't really surprising. In fact, the real worry should be that the administrative costs for the internet companies to have to figure out how to compensate smaller publishers is so unworthy of the hassle, that those smaller publications will just start to be excluded en masse from Google and Facebook, once again serving the interests of the largest publishers, and not actually helping the cause of journalism at all.

Filed Under: australia, link tax, rupert murdoch, wealth transfer
Companies: facebook, google, news corp.

Australian Official Admits That Of Course Murdoch Came Up With Link Tax, But Insists The Bill Is Not A Favor To News Corp.

from the did-he-just-say-that-out-loud? dept

Earlier this year, we wrote a lot about the ridiculous anti-open internet Australian link tax that is now being pushed elsewhere around the globe. Anyone paying attention to the details knew that it was extreme crony capitalism at work, with the government forcing one set of massive companies (namely, Facebook and Google) to pay another set of massive companies, led by Rupert Murdoch's News Corp and Nine. For all the talk of how big tech companies are "monopolies," if you look at Australia's news companies, it's considered among the most concentrated in the world, and has been quite profitable for the likes of Murodch.

And while defenders of the bill insist (incorrectly) that the bill is not a link tax, but is merely a "competition bill" to help those few giant newspaper companies "better negotiate" with the giant internet companies, that's bullshit for two reasons. First, it's a "negotiation" to pay for links, and no one should ever have to pay to link to some other site. That's just fundamentally against the concept of an open internet. Second, it's no real negotiation because if Facebook and Google fail to agree to a deal that satisfies the Aussie media bosses, the government can step in and force an agreement on them.

Lots of people -- including those in Australia -- noted that this all seemed like a scheme to make Rupert Murdoch richer. And now the Australian competition official, Rod Sims, who "oversaw drafting of the law" has flat out admitted that the whole thing was Murdoch's idea in the first place, though he insists it's "extremely strange" that anyone thinks it's a favor to Murdoch.

Australian Competition and Consumer Commission (ACCC) chair Rod Sims, who oversaw drafting of the law, acknowledged the negotiating system was proposed by the Rupert Murdoch-controlled publisher but said all major media operators in the country supported it.

I mean, yeah, of course they supported it. Because it's the government forcing other companies to give them free money in response to their own failures to innovate. Why wouldn't they support it?

It is true that Google and Facebook are bigger than News Corp., which is the point that Sims really really wants to focus on. But that doesn't even touch on whether or not it's appropriate to force one set of companies to pay for something that should be free (linking), to another set of companies that are still making a shit ton of money on their own.

"News Corp is 1% the size of Google. News Corp is one of four main media companies (in Australia). It's very likely not the one with the biggest reach. I just think this is a line put out by Google," Sims added.

"There were many people giving us ideas. News Corp was but one. This whole notion that this is about News Corp is extremely strange."

You literally just admitted that the idea came from News Corp! It wasn't "a line put out by Google." It was you, who just admitted what was obvious to anyone who's been paying attention to Murdoch for years. After all, Murdoch has been publishing op-eds (in his own company's publications, of course), demanding Facebook and Google pay him for years. It's not like he made it a secret.

Can you make an argument that Google and Facebook are too powerful? Sure, absolutely. But, can you then make the argument that these companies which found a way to build internet services billions of people like... should be forced to pay for Murdoch's brand of propaganda, despite there being no fundamental reason that he deserves any of that money? Not unless you want people to think you're in Murdoch's pocket.

Filed Under: australia, competition, link tax, news organizations, rod sims, rupert murdoch
Companies: facebook, google, news corp., nine

Hypocrisy: Rupert Murdoch Has Always Hated Antitrust; But Now He Wants It Used Against Internet Companies Who Out Innovated Him

from the the-cronyiest-of-capitalists dept

It's no secret that Rupert Murdoch is an extreme hypocrite. He spent decades railing against any kind of regulatory powers to hold back companies, but as soon as his own attempts to build an internet empire flopped dramatically, he's come around to being a major booster of regulatory crackdowns. Just only against the companies who out-innovated him. For years now he's been demanding that governments force the internet companies to pay him money -- a move that has been successful in his home country of Australia.

The latest is that Murdoch, who built his business empire by buying up competitors and doing everything possible to avoid antitrust authorities, is now a major force behind supporting antitrust efforts -- so long as they're aimed at the internet companies. When the Democrats released their 5 antitrust proposals last week, each one (perhaps somewhat surprisingly) had a Republican co-sponsor. That appears to have been thanks to Murdoch:

Fox Corp. and News Corp. lobbyists have been urging GOP members to support the bills this week, according to people familiar with the efforts, with two sources saying there could be as many as 3 to 4 GOP co-sponsors on each bill. Talks are ongoing....

Say what you want about Rupert Murdoch, but the idea that he's a free marketer and against regulations is nonsense. That was only true when the regulations involved his companies. Now that he's failed to innovate, he's spent the last decade demanding that governments punish the companies who actually competed better than he did. He's the cronyist of the crony capitalists.

Filed Under: antitrust, competition, congress, innovation, rupert murdoch
Companies: news corp.

Facebook Caves To Australia: Will Restore Links After Government Gives It More Time To Negotiate Paying For News Links

from the still-not-great dept

Facebook is restoring news links in Australia after the government agreed to amend the proposed link tax law. We'll explain the details down below, but at the very least, this shows part of the reason Facebook did what it did, when it did. The end result still sucks, and I wish Facebook had stood its ground here because this portends a significant closing off of the open internet.

Many of the people who were annoyed over my support of Facebook's decision last week to block all news links in Australia kept saying "but the law hasn't passed yet -- why would they do this now?" Except... that ignored the reality of the situation. Facebook had announced last summer that it would remove links to all news if the law wasn't changed. And the Australian Parliament mocked Facebook and refused to make any changes to the law -- which was set to pass this week.

So, Facebook showed that it was serious about what it said last September, and it did so days before the law was supposed to pass... and now the Australian government has agreed to make changes. So, Facebook did get something out of making the move last week. Unfortunately, they didn't get nearly enough, and the end result is a disaster for the open web, but good for Rupert Murdoch.

The law is still really bad. The only major difference is that Facebook gets a little more time to cut a deal with Murdoch and other Australian news org owners:

But on Monday, the Australian government added amendments to the proposed code. That included a two-month mediation period, giving the two sides more time to negotiate commercial deals that could help Facebook avoid having to work under the code’s provisions.

In exchange, Facebook agreed to restore news links and articles for Australian users “in the coming days,” according to a statement from Josh Frydenberg, Australia’s treasurer, and Paul Fletcher, the minister for communications, infrastructure, cities and the arts.

“Importantly, the amendments will strengthen the hand of regional and small publishers in obtaining appropriate remuneration for the use of their content by the digital platforms,” the statement added.

Campbell Brown, Facebook’s vice president of global news partnerships, said in a statement, “We’re restoring news on Facebook in Australia in the coming days. Going forward, the government has clarified we will retain the ability to decide if news appears on Facebook so that we won’t automatically be subject to a forced negotiation.”

I honestly don't know what this actually means for the future of the law, but it still looks like a mess. Having Facebook pay for any links to news articles should be a non-starter. It is fundamentally against the idea of an open web. People who keep insisting that this is not a "tax" or that it's somehow about "competition" are wrong and fundamentally misrepresenting what is happening here. Yes, Facebook and Google are big. Yes, if there were negotiating a deal they would have leverage. But -- and here's the important part -- there's nothing to negotiate over here, because there's no requirement anywhere to pay for links, because that's fundamentally stupid and against the idea of an open internet.

So, those who keep saying this is necessary because without it the media organizations in Australia "don't have bargaining power" against Google and Facebook are simply missing the point. I mean, those same media organizations do have bargaining power with a site like, let's say, Techdirt. I link to them sometimes. They're a hell of a lot bigger than me. So, does this mean that I should be able to go to the Australian Competition authority and demand they make News Corp pay me when I link to them? That makes no sense at all. There should never need to be any negotiation or any discussion about bargaining power over links because links are fundamentally free.

And, yet, the end result of this deal is that it sounds like Facebook is effectively caving and agreeing to pay for links. The "compromise" appears to be just that Facebook gets a few more months to negotiate what it will pay (and if those negotiations fail, Australian arbitrators will simply choose how much it pays). This remains a very bad and dangerous idea, that is going to lead to a big mess around the globe. Lots of other industries are going to start demanding payments for links as well, and it puts the fundamental nature of the open internet under attack.

Filed Under: australia, competition, link tax, links, negotiations, news, rupert murdoch
Companies: facebook, news corp.

Australian News Sites Shocked & Upset To Learn They Don't Need To Rely On Facebook For Traffic!

from the wait,-that's-possible?!? dept

I am still perplexed and confounded at how many people seem to think that Facebook is the one at fault for blocking links to news in Australia. Again, the law (that was about to be approved by the Australian Parliament despite Facebook warning them months ago that it would be forced to block news links if it went forward in its current form) would have been a disaster for the open web. And that's even if you believe that Facebook itself has been a disaster for the open web. You can say that Facebook is the worst company in the world... and still recognize that this was the right move.

The law mandated that if Facebook had any links to news, then it had to negotiate a deal to pay certain news organizations (mainly Australia's largest news organizations, where Rupert Murdoch is the dominant owner in a news industry that is one of the most consolidated in the world). If Facebook and Murdoch couldn't reach an agreement, then they had to go to binding arbitration in which an arbitrator would simply tell Facebook how much it had to give Murdoch and other major media owners. Some have argued that this is not a tax, but... having the government step in to force a company to pay money for doing business is, by any normal definition, a tax. Though, this is actually worse than a tax, because it's not putting the money into the hands of the government to be invested in public works. It's going to one of the richest people in the world. For what? For failing to adapt to a changing market.

As we noted a few years ago, it's truly stunning that Murdoch, who has spent much of his life going around the world preaching the gospel of "free market" and deregulation, completely changed his tune when he completely misunderstood the internet, and saw multiple internet investments disappear. So he turns around and demands that the companies who actually innovated simply have to give him money? That doesn't sound like a free market. It sounds like welfare for a billionaire who's upset he's not even richer.

Even so, the most bizarre thing about last week's story is how many Facebook haters who have insisted for years that Facebook "killed" the news business were absolutely apoplectic that Facebook was getting out of the news business entirely. You'd think they'd celebrate. Facebook can't keep killing the journalism business if it's not in that business any more.

The other bizarre reaction -- which filled my Twitter feed to a point of ridiculousness for days -- was the claim that Facebook was somehow "blocking important news" in Australia, including news about the pandemic and vaccines. Except... it wasn't. No news was "blocked." Just links to news on Facebook. All of these news organizations have websites. And many have apps. And they all still exist.

Indeed, the most amusing thing in all of this is that people in Australia are suddenly discovering that they don't need Facebook for news. The Australian Broadcasting Company (ABC) saw its own news app shoot to the top of the Apple App Store charts in Australia. Ironically, the original draft of this stupid law was so biased towards Murdoch that it originally excluded ABC from getting any money, and was only added later, after some folks pointed out how blatantly corrupt it was to leave them out and just funnel more money to Murdoch. But it's not just ABC that has benefited. In a Reuters story, News Corp's executive chairman in Australia, Michael Miller, admitted that direct traffic to their websites was way up as referrals from Facebook disappeared:

“Definitely referral traffic was nonexistent ... while at the same time direct traffic to our websites was up in double digits,” he told the inquiry.

That... seems like a good thing? But, of course, this was never actually about helping news organizations like this. It was always about the cash transfers. Because immediately after Miller admits that direct traffic to their websites is way up, he demands that the Australian Competition and Consumer Commission (ACCC) "scrutinize Facebook's move."

I mean... what the fuck is going on here?

Rather than having Facebook mitigate your traffic, which is what you've been complaining about for years, the company has exited the space, leading to a massive jump in direct traffic. The reaction here shows pretty clearly that the problem is not Facebook. The problem is that News Corp. and other Australian news organizations are too lazy to actually do anything with all of this direct interest. Facebook just dumped a direct connection to users right in these news organizations' laps -- removing Facebook as a middleman -- and the news organizations' response is... to blame Facebook and try to get the Competition authority to go after them. For what? Helping them? This whole thing is so bizarre.

The same Reuters report notes that traffic from Facebook to Australian news sites plummeted after the ban, as you'd expect. But, again, isn't that what all the Facebook haters wanted in the first place? To get Facebook out of the news intermediary business?

It seems the truth is pretty self-evident: this was all a greed play. They just want Facebook's money, but they don't want to actually do the work to earn it.

Filed Under: australia, direct traffic, link tax, news tax, tax, traffic
Companies: abc, facebook, news corp.

The Bizarre Reaction To Facebook's Decision To Get Out Of The News Business In Australia

from the it's-quite-reasonable dept

None of this should have been a surprise. Back in September we wrote about Facebook publicly saying that if Australia went forward with its ridiculous attack on the open internet, and instituted a "news link tax" on Facebook and Google, that it would block news links on Facebook in Australia... and basically everyone ignored it. So, yesterday, when Facebook announced that it was no longer allowing news to be shared in Australia (and relatedly, no longer allowing the sharing of Australian news services on Facebook), it should not have been a surprise.

And yet... it seemed to make tons of people freak out for all the wrong reasons. Almost everyone started blaming and attacking Facebook. And, look, I get it, Facebook is a terrible, terrible company and deserves lots of blame for lots of bad things that it does. But this ain't it. There are a lot of examples of this, but because he's the top member of the House of Representatives working on antitrust issues, I'll specifically call out Rep. David Cicilline's response:

That says:

If it is not already clear, Facebook is not compatible with democracy.

Threatening to bring an entire country to its knees to agree to Facebook’s terms is the ultimate admission of monopoly power.

But that's completely nonsensical. We can argue about whether or not Facebook is "compatible with democracy" but the simple facts of the situation are that Australia -- pushed heavily by Rupert Murdoch -- has decided to put in place a plan to tax Google and Facebook for any links to news. The bill has all sorts of problems, but there are two huge ones that should concern basically anyone who supports a free and open internet.

First is the link tax. This is fundamentally against the principles of an open internet. The government saying that you can't link to a news site unless you pay a tax should be seen as inherently problematic for a long list of reasons. At a most basic level, it's demanding payment for traffic. There are two entire industries out there based entirely around trying to get more traffic from these companies: "search engine optimization" and "social media management." The reasons there are those industries is because everyone else in the world has figured out that having prominent links on search engines and social media is valuable in its own right and that it's up to the sites that get those links, and the corresponding traffic, to make use of it.

But here, a bunch of lazy newspaper execs who failed to adapt and to figure out better internet business models not only want the traffic, they also want to get paid for it.

This is like saying that not only should NBC have to run an advertisement for Techdirt, but it should have to pay me for it. If that seems totally nonsensical, that's because it is. The link tax makes no sense.

And, most importantly, as any economist will tell you, taxing something doesn't just bring in revenue, it decreases whatever you tax. This is why we have things like cigarette taxes and pollution taxes. It's a tool to get less of something. So, in this case, Australia is saying it wants to tax links to news on Facebook, and Facebook responds in the exact way any reasonable economist would predict: it says that's just not worth it and bans links. That's not incompatible with democracy. It's not bringing a country to its knees. The country said "this is how much news links cost" and Facebook said "oh, that's too expensive, so we'll stop."

Contrary to the idea that this is an "attack" on journalism or news in Australia, it's not. The news still exists in Australia. News companies still have websites. People can still visit those websites.

Indeed, the people who are saying that this move by Facebook is somehow an "attack" on news or an attack on Australian sovereignty seem to be admitting more than they'd really like: that they think Facebook must be a dominant source of news in the country.

I mean, if Facebook is really such a problem, shouldn't they all be celebrating? This is Facebook saying "okay, okay, we'll completely remove ourselves from the news business." Since everyone was complaining that Facebook was too much of a presence in the news business... isn't that... a victory?

And we haven't even gotten to the other problematic part of the law -- which is that it requires Facebook and Google to give newspapers heads up to algorithmic changes. This is completely disconnected from reality. Facebook and Google may make multiple algorithm changes every day, just to keep their services running. Having to tell newspapers (and them alone) about those changes with a few weeks notice is basically giving those news organizations the keys to the kingdom: it's telling them how to game the algorithms. If you think bogus clickbait is a problem now, just imagine what it's like when all of the Australian press get to know the secrets behind the algorithm, and get to prepare for any changes.

The whole story is absolutely ridiculous. And the most incredible thing is that no matter what Facebook did here it would have gotten yelled at. And the proof is not hard to find. Because just an hour or two before Facebook made this announcement, Google went the other way -- coming to an agreement to pay Rupert Murdoch for featuring Murdoch-owned news organizations content on Google. And people freaked out, complaining about Google helping fund Rupert Murdoch's disinformation empire. Except... that's the whole point of the law? So it's a bit bizarre that the same people are mad about both Facebook's decision to not give free money to Rupert and Google caving to do exactly that:

So... it's bad to pay Murdoch. And it's bad not to pay Murdoch. There is no consistency or principle behind all this other than people so focused on "Facebook and Google must be evil, so even when they do the exact opposite of each other, both are more evidence of evil."

This fight was not "Facebook v. Australia." Or "Facebook v. journalism" even though some ignorant or dishonest people are making it out to be the case. This was always "Rupert Murdoch v. the open web." We may not like Facebook in the role of the defender of the open web (and it's far from the best representative for the open web). But Facebook saying that it won't pay a link tax is a defense of the open web and against Rupert Murdoch. It's the right move, and whatever else you may think of Facebook, the company deserves credit for taking the right stand here.

Filed Under: australia, link tax, links, news, open internet, rupert murdoch
Companies: facebook, google, news corp.

Why Is Fox News Acting As State Media, Announcing Trump's Lawsuits Before They're Filed And Failing To Point Out How Frivolous They Are?

from the that's-a-rhetorical-question dept

As we've been pointing out, the Trump campaign, with the help of lawyer Charles Harder, has been suing a list of media enemies over the past week. There was the NY Times, followed by the Washington Post and (probably not) finally, CNN. We've detailed why each lawsuit is frivolous, and how they appear to be playing to Trump's base in a performative manner, attacking the credibility of the media which has done critical reporting on his Presidency, and doing so in a manner that potentially serves two purposes: gets his fans riled up about the media while simultaneously creating a chilling effect on fairly typical journalistic analysis of the Trump administration and campaign.

But I wanted to focus in on a separate point: the effective "state media" of Fox News reporting on these lawsuits in absolutely ridiculous ways. Reporter Gregg Re wrote about the NY Times case, and at least included a link to the filing and noted that "lawsuits for libel against media organizations by public figures must clear a high bar." But the reporting on the next two lawsuits, done by reporters Brian Flood and Brooke Singman, were terrible. Both of them claimed that reporting on the filing of a federal lawsuit was a Fox News "exclusive." That's not what exclusive means, guys.

Also, while Fox News eventually added a link to the filing in the story about the CNN lawsuit and the NY Times one, it initially did not link to the CNN one, and as of this writing has still not linked to the Washington Post filing. Indeed, as you can see above, the reporters almost gloat over the fact that Fox News "obtained" access to the lawsuit -- and then failed to provide it to their readers. And with the CNN lawsuit, a search of PACER a couple of hours after the Fox News article went live showed no evidence that the case had actually been filed yet. In other words, it's likely that someone associated with the campaign or the lawsuit handed the complaint over to Fox News to "break" the "exclusive" story.

And perhaps that explains why the reporting by Flood and Singman is so, so bad. Unlike the story by Re regarding the NY Times lawsuit, this one makes no effort to explain why this lawsuit faces a huge barrier (known as the 1st Amendment). Even worse, it repeats a blatantly false statement from the campaign's "legal adviser" Jenna Ellis:

“False statements are not protected under the U.S. Constitution; therefore, these suits will have no chilling effect on freedom of the press. If journalists are more accurate in their statements and reporting, that would be a positive development, but not why these suits were filed," Ellis added.

There is some irony in this statement about false statements being false, but it is. There's plenty of precedent here, including (most clearly) the United States v. Alvarez (a case we've been pointing to a lot lately), which says:

The Court has never endorsed the categorical rule the Government advances: that false statements receive no First Amendment protection.

A good reporter would perhaps point that out in response to Ellis. But it appears that Fox News is less interested in employing good reporters, and more interested in acting as state media, and boosting the President it supports.

This is especially sickening, given that these are attacks on the very 1st Amendment that protects Fox News -- and its long history of misleading, inaccurate, and occasionally false statements, that the network is somewhat infamous for. You would think, if it wasn't subsumed in cultish adherence to the President, that it would recognize the importance of actually continuing to defend the part of the Constitution that allows them to exist. At the very least, you might hope that its reporters would be careful enough to accurately report the law. Apparently that is too much to ask.

Filed Under: 1st amendment, brian flood, brooke singman, charles harder, defamation, donald trump, free speech, gregg re, slapp, state media
Companies: fox news, news corp.

Is There A Conspiracy Among Legacy Media Companies To Push A False Narrative About Big Tech?

from the well,-there's-some-smoke... dept

Over the last few months we've witnessed a veritable flood of misleading to simply false articles about internet companies showing up in mainstream sources. There were misleading articles in Vox and the Washington Post. And then, just recently, we saw not one but two NY Times pieces that went out of their way to misrepresent the law. And, then of course, there's the Wall Street Journal that has been misrepresenting Section 230 for ages. To date, the only one of these publications to run a serious correction (and to continue to help debunking misrepresentations) is the smallest of those listed above: Vox, who did some research and published a big mea culpa.

This has gotten many in the tech industry to begin to wonder. It's one thing for (cross aisle) grandstanding politicians like Ted Cruz, Josh Hawley, Nancy Pelosi, and Richard Blumenthal to totally misrepresent the law. But when the mainstream media is doing so on a regular basis -- it's causing a lot of talk behind the scenes about whether this is a coordinated hit. Some, like the excellent reporter Anna Wiener, recently more or less dismissed this theory as being "mostly... a facile argument," though I think she mixes up two separate issues. First, it is absolutely true that many startup founders don't know how to deal with the press well, and get personally offended by bad press coverage. And, for those entrepreneurs: fuck 'em. They should grow up and learn what the press actually does, when done right -- which includes researching and debunking nonsense (and there's a ton of nonsense in Silicon Valley).

But, that's a separate issue from whether or not there's a coordinated campaign to undermine the foundations of the internet by a few larger, legacy industries who have failed to adapt to a changing time. Indeed, we saw significant evidence of Hollywood's top lobbyists working behind the scenes (though, it occasionally slipped out publicly) to push for FOSTA, the first bill that significantly undermined Section 230.

And there's plenty more evidence of legacy industries -- mainly legacy media and entertainment companies -- plotting to take down internet companies by making use of the news. Remember, during the Sony Pictures hack, that MPAA emails were leaked, revealing "Project Goliath," which was specifically a plan to damage Google through any means necessary -- and that included using a smear campaign placed in the Wall Street Journal and on the Today Show. In an email sent to an official in Mississippi Attorney General Jim Hood's office by then MPAA "director of external state government affairs" official (and former ICE official) Brian Cohen, Cohen admits the "proposed plan" is to place an anti-Google smear campaign:

If that image is not showing up, the text comes from a larger strategic plan between the MPAA and various state Attorneys' General, and includes this:

Media: We want to make sure that the media is at the NAAG meeting. We propose working with MPAA (Vans), Comcast, and NewsCorp (Bill Guidera) to see about working with a PR firm to create an attack on Google (and others who are resisting AG efforts to address online piracy). This PR firm can be funded through a nonprofit dedicated to IP issues. The "live buys" should be available for the media to see, followed by a segment the next day on the Today Show (David green can help with this). After the Today Show segment, you want to have a large investor of Google (George can help us determine that) come forward and say that Google needs to change its behavior/demand reform. Next, you want NewsCorp to develop and place an editorial in the WSJ emphasizing that Google's stock will lose value in the face of a sustained attack by AGs and noting some of the possible causes of action we have developed.

So, sure, while it may seem "facile" for some to argue that legacy media firms are out to get big internet companies with trumped up claims in their own media properties, there's very real evidence of a conspiracy to do literally that. Not so facile.

And there's more where that comes from. In Wired's giant profile last year of the "troubles" inside Facebook, it is made clear that Rupert Murdoch used his ability to damage the company via the editorial pages of the WSJ as part of a negotiating strategy:

Zuckerberg traveled to Sun Valley, Idaho, for an annual conference hosted by billionaire Herb Allen, where moguls in short sleeves and sunglasses cavort and make plans to buy each other’s companies. But Rupert Murdoch broke the mood in a meeting that took place inside his villa. According to numerous accounts of the conversation, Murdoch and Robert Thomson, the CEO of News Corp, explained to Zuckerberg that they had long been unhappy with Facebook and Google. The two tech giants had taken nearly the entire digital ad market and become an existential threat to serious journalism. According to people familiar with the conversation, the two News Corp leaders accused Facebook of making dramatic changes to its core algorithm without adequately consulting its media partners, wreaking havoc according to Zuckerberg’s whims. If Facebook didn’t start offering a better deal to the publishing industry, Thomson and Murdoch conveyed in stark terms, Zuckerberg could expect News Corp executives to become much more public in their denunciations and much more open in their lobbying. They had helped to make things very hard for Google in Europe. And they could do the same for Facebook in the US.

.... Inside Facebook, executives believed Murdoch might use his papers and TV stations to amplify critiques of the company. News Corp says that was not at all the case; the company threatened to deploy executives, but not its journalists.

Zuckerberg had reason to take the meeting especially seriously, according to a former Facebook executive, because he had firsthand knowledge of Murdoch’s skill in the dark arts. Back in 2007, Facebook had come under criticism from 49 state attorneys general for failing to protect young Facebook users from sexual predators and inappropriate content. Concerned parents had written to Connecticut attorney general Richard Blumenthal, who opened an investigation, and to The New York Times, which published a story. But according to a former Facebook executive in a position to know, the company believed that many of the Facebook accounts and the predatory behavior the letters referenced were fakes, traceable to News Corp lawyers or others working for Murdoch, who owned Facebook’s biggest competitor, MySpace. “We traced the creation of the Facebook accounts to IP addresses at the Apple store a block away from the MySpace offices in Santa Monica,” the executive says. “Facebook then traced interactions with those accounts to News Corp lawyers. When it comes to Facebook, Murdoch has been playing every angle he can for a long time.” (Both News Corp and its spinoff 21st Century Fox declined to comment.)

Got that? Facebook actually traced fake accounts, that were handed to long-grandstanding anti-internet crusader Richard Blumenthal (then a state AG, now a Senator) back to News Corp. And Murdoch strongly implied to Facebook execs that he needed to get a better deal from them or his publications, such as the WSJ, would put out hit pieces.

So, yes, there are legitimate points of concern to raise about big internet companies. I'm not one to normally believe in cynical conspiracy theories, but it's not at all crazy to think that the recent onslaught in major media properties may not be coming from the most ethically sound place. After all, if Hollywood has plotted in the past to do exactly that, why would anyone expect them to have given up those underhanded games?

Filed Under: attacks, behind the scenes, conspiracy, hit pieces, journalism, lobbying, media, misrepresentations, section 230
Companies: comcast, mpaa, news corp.

Rupert Murdoch Believes In The Free Market... Until His Company Is Struggling: Then He Wants To Regulate Competitors

from the hypocrite dept

Oh, Rupert Murdoch. When we last checked in with him, he was literally begging Facebook to pay News Corp. money because (he claimed) News Corp was "enhancing the value and integrity of Facebook." We noted at the time that Murdoch -- a staunch public defender of free market capitalism and a loud opponent of "socialism" -- seemed to be a bit hypocritical in effectively demanding a corporate handout from other, more successful companies, when his own company had struggled for years to adapt to the internet.

He's not done yet. Apparently, if Facebook (and, one presumes, Google) don't want to just hand him money for nothing, he's now demanding that they be heavily regulated:

Robert Thomson, the CEO of Murdoch’s company, News Corp., took a step beyond criticism last week in an investor call, when he advocated the creation of an “algorithm review board,” which would essentially regulate the secret formulas platforms use to determine, among other things, what news is shown to which people.

What a fucking hypocrite. Just compare this to what Murdoch was saying just a few years ago about free markets, competition, regulation and s haring:

But while we’ve won the efficiency argument, we have yet to persuade people that the market does better because it is more moral — or that socialism fails because it is largely immoral in its denial of fundamental freedoms.

To the contrary, too many people think that the market succeeds because it is based on a vice — greed. And that socialism is better, because it is based on a virtue — sharing.

Naturally, they conclude from this one of two things: that the way to make capitalism more just and more humane is to temper it by injecting a large dollop of government-mandated sharing, or that, like President Obama, government is better.

Or how about this gem:

How often do you hear the same people who say they are for free trade then push for stronger anti-dumping laws, a backdoor form of protectionism?

How often do we hear the same politicians who say they believe in free markets go on to carve out a special tax credit for some industry they favor?

Oh, Rupert, why it happens all the time. Sometimes from people like yourself.

Crony capitalism is not capitalism. It’s cronyism.

Yes. So why are you trying to get your crony's to regulate your competitors who have done a much better job than you in the market?

The market succeeds because it gives people incentives to put their own wants and needs aside to address the wants and needs of others. To succeed, you have to produce something that other people are willing to pay for.

And if he fails to get people to pay for it, Rupert Murdoch will run to the government, demanding that more successful companies just pay him, and then will also advocate for heavily regulating those companies while pretending to be for the free market and against cronyism.

What’s fair about taking money from people who’ve earned it and giving it to people who didn’t?

Says the guy demanding money he didn't earn from internet companies...

In short, as we work for freer markets, we must also work to persuade our fellow citizens that we do so not simply because a free market is more efficient but because it is fair and just and right.

Yes, Rupert Murdoch believes this right up until his own companies have trouble adapting and competing. Then he goes running to government to regulate those companies who are actually succeeding.

There may be reasonable arguments for certain kinds of regulations. But Murdoch's only reason for calling for regulations of internet companies -- after whining about socialism and talking up free markets -- is pretty blatantly an attempt to whine for a handout for his own businesses that have failed to adapt to changing times.

Filed Under: algorithms, competition, free market, internet, regulations, rupert murdoch
Companies: facebook, google, news corp.