News traffic in Australia drops after Facebook link-sharing ban

Traffic to Australian news sites within Australia from Facebook links plummeted following Facebook's decision to stop allowing users and publishers to share links on its platform Wednesday, according to data from Chartbeat.

Why it matters: Usually when Facebook's app goes down fully, news traffic will shift to other platforms. But because only link-sharing was restricted, it resulted in people visiting fewer news sites in Australia overall.

Total news traffic to Australian news sites within Australia fell by about 13% after Facebook began limiting link-sharing, per Chartbeat. Total traffic coming to Australian news sites from outside of the country dropped about 30%.

• Facebook says last year it generated approximately 5.1 billion free referrals to Australian publishers worth an estimated AU $407 million. 

Yes, but: While the numbers show how powerful Facebook is a news distribution tool, it doesn't mean that news traffic referrals will be down forever.

• There's also a small chance Facebook is still able to negotiate a deal.
• Australian treasurer Josh Frydenberg said Thursday the government will continue to hold talks with Facebook CEO Mark Zuckerberg. “We’ll see if there’s a pathway forward."

Be smart: Facebook's decision to stop link-sharing was made in response to a new law that forces Google and Facebook to pay Australian news publishers for content. That includes headlines and links, with terms set by a third party.

• While the law is intended to benefit publishers, it's likely that it will result in local publishers needing to invest in new traffic referral strategies.
• Comscore says Facebook’s referral traffic to news publishers is higher in Australian than compared to the global average.

• Facebook said it pulled out of the region because the law "fundamentally misunderstands the relationship" between its platform and publishers who use it to share news content."

The big picture: The response to Facebook's decision has been mixed. Some think the tech giant was right to walk away from what can essentially be considered a news tax that fundamentally goes against the principles of an open internet.

• Others said Facebook was wrong to pull out of the country, as it would be restricting thousands of people and publishers from being able to stay connected during a pandemic. Those cries grew louder Wednesday when it Facebook accidentally blocked nonprofit publishers and government websites.
• Facebook says it's working to quickly restore any mis-targeted pages, but that the law isn't clear about which entities the government considers "news."

What to watch: The law is still expected to pass this week.