Lanai Scarr: The story behind Facebook’s deal with the Australian Government and Treasurer Josh Frydenberg

It’s been a tremendous task that has required special sauce and then some. Facebook’s threat, and subsequent actions, to suspend all Australian news and public information sites on its platform threatened to derail years of work on a media bargaining code. When Treasurer Scott Morrison started the ball rolling just before Christmas in 2017 by tasking the consumer watchdog to look into the reach big tech giants have in Australia he knew it would be a mighty task. And now Treasurer Josh Frydenberg, often referred to as the energiser bunny, was not about to let things slip at the 11th hour. On Thursday when Australians woke to news that sites and vital public information sources like the Bureau of Meterology — and even 1800RESPECT — being blocked, panic began to swell. The night before, the Government’s proposed media reforms had gone through the House of Representatives and the social media giant was not happy. Unlike Google they acted on their threat to remove Australian news. It was a negotiating tactic in the starkest degree. They were serious that without change the cord would be cut to Australia. Over the weekend, Frydenberg and Facebook founder Mark Zuckerberg were in constant contact. They spoke directly three times today and three times yesterday. Sources close to Frydenberg say he described the ordeal as the hardest thing he’s ever had to negotiate in politics. It was a David and Goliath situation in which Mr Frydenberg was most definitely David. The Government was serious on a media bargaining code. They had too much skin in the game and the world was watching to see if Facebook was able to bully a western government into submission. In the end both parties were able to bend. News will be restored in Australia but not before the Government made amendments to its code as flagged by The West Australian over the weekend. Frydenberg, the man who very much has studied The Art of the Deal, will spin it as a win for media in Australia and his Government. He will say he stared down Zuckerberg and won. But Facebook knows it was able to throw its weight around and make sure Australia knew the power it wields. The public does and will panic if they can’t get everything they need on Facebook. Ultimately if Facebook is back at the table in a meaningful way and they will cough up money for quality Australian news, it’s a win — despite the drama.