Following Friday’s controversial news that Facebook is abandoning its news content deals with local content providers, the Australian Financial Review has shed some light on the nature of the deals.
Summary agreements obtained by the AFR, owned by Nine, show that Network 10 was required to upload some 18,000 videos to Facebook in return for funding from Meta.
The first contract between Network 10 and Meta (then named Facebook) began on June 15, 2021 with Meta agreeing to pay Network 10 USD$2,750,000 (AUD $4,215,062) for the three years that content is posted.
Once Facebook has recouped its net expenditure, Network 10 would be entitled to 55 per cent of any additional net advertising revenue.
The funds were paid monthly in a lump sum of $US229,166.67 (AUD$351,254). The deal was approved by six people at Network 10 including Paramount’s chief content officer Beverley McGarvey.
The second agreement was between Network 10 and Facebook Ireland for $400,000 a year. This was an “agreement to monetise articles created by The Project on the Facebook News Surface platform via a content feed from 10Play”.
As per this agreement, Network 10 agreed to post 6000 clips a year from its news shows including 5pm bulletin 10 News First, Studio 10 and The Project. The clips had to be a certain length and posted at certain times.
The 1500 videos had to be at least three minutes long and had to be posted no later than 6 hours after the show ended. For The Project they could be posted 12 hours after The Project ended.
If clips from these shows couldn’t be posted for any reason then Network 10 would need to suggest relevant videos “of equivalent or greater value, quantity, and quality”. The contracts funded several roles at Network 10 responsible for sharing video content to Facebook, sources with knowledge of the deals said.
The deal included termination rights, in which Facebook was able to terminate the deal if it decided to pull news from its platform or if Meta was designated under the code.
The financial impact of Meta pulling out of its deals with local providers is expected to be substantial. Brokers at Macquarie estimate that Nine, Seven, and News Corp will lose between 5 and 9 per cent of their net profits each year if the deals don’t continue.
Media outlets including Seven, Nine, and News Corp expressed their disappointment with the Meta’s decision on Friday with Nine CEO Mike Sneesby saying “Meta’s decision does not recognise the significant and increasing value of Nine’s journalism, unique content and brands to its platforms”.
A Network 10 spokesperson said: “We are disappointed with the decision by Meta announcing it will no longer pay for use of Australian news content on Facebook.
“It is essential that Australian news media services are fairly remunerated for their trusted, local and impartial news content. Without fair compensation, it becomes increasingly difficult for news organisations.
“We urge the Government to designate Meta under the News Media Bargaining Code but further implore them to expand the Code to cover video specific platforms, that also reap significant value from sharing news content across their services.
“It is more important, now than ever before, to maintain trusted and regulated news sources on platforms because without this, the avalanche of misinformation will continue to propagate.”
