Google is threatening to remove its search engine from Australia if the government passes a proposed news media bargaining code that would make big tech platforms pay media companies.
The company’s Australia and New Zealand managing director Mel Silva told a Senate Estimates hearing Google would have “no other choice but to stop making Google search available in Australia”, confirming what was predicted in Crikey last week.
Key to Google’s objection to the code is a requirement that it pays media companies for links and snippets that appear in search, and a mandatory arbitration process between the tech giants and news outlets over the value of content.
Such processes, Silva said, presented “unmanageable financial risk” for the company and were “simply untenable.”
“This is our worst case scenario,” Silva repeatedly said, of the company’s threat to rob users of its search engine.
Google’s proposed solution was to partner with publishers through its News Showcase initiative, where it enters commercial arrangements with individual media companies to create panels of news and give users access to paywalled stories.
But so far, Showcase isn’t available in Australia, meaning the government, regulators and media outlets aren’t able to assess whether it’s a workable solution.
“No one can see Showcase. How can we take your blackmail and your threats seriously?” Liberal Senator Andrew Bragg said.
Silva said Google was committed to launching Showcase in Australia.
Last week, Google flexed on Australian users by running an experiment where news results were hidden from the search engines of about 1% of domestic users.
Silva said those experiments were “forced on us” and were part of Google’s scenario planning.
If the company follows through with its worst case scenario, domestic users who landed on a Google search page would be presented with a screen telling them why they could not use the website in Australia. Silva conceded that the value of advertising on Google for domestic businesses would be substantially diminished.
Senators expressed outrage at the company’s attempted shakedown of Australia. Independent Senator Rex Patrick compared it to China’s escalation of a trade war after Scott Morrison called for an investigation into the origins of COVID-19. Bragg said the company was attempting to blackmail Australian users.
Greens Senator Sarah Hanson-Young accused Google of paying inadequate tax, and said it misused its substantial market share.
“You have amazing market power in this country, and now you come to the parliament and say change this or we’ll shut everything down. How do you justify that in the public interest?” Hanson-Young said.
On Thursday, Google signed a deal with French media companies under which it will pay publishers for content.
How do mainstream journalists at News, Nine and 7West get away with their obvious bias in reporting on this story.
The Greens led by SHY continue to do the bidding of News Corp – which is extraordinary given how much bile News Corp mastheads pile on the Greens.
Labor as usual is too stupid to turn this against the govt and the major media as being nothing more than extortion payments for the protection racket they collectively run to keep LNP govts in power.
Sure make Google and Facebook et al pay more taxes, but this will be just an onshore business deduction that will directly reduce their annual tax bill.
Nice poker move by Google. All those businesses who strive to be on page one of Google for their very existence one the side, and the old media companies on the other.
Who will the LNP side with ?
There will be a lot of VERY pissed SME’s if Google follows through. I’m sure Scotty will get the message.
that should have read “on one side, and the old….”
Agree, none of the protaganists promoting action against Google/Facebook seem to understand how important Google is for small medium businesses to be visible online for searches via developing quality content and SEO, or free Facebook business pages; as opposed to very much supporting another form of subsidisation for NewsCorp, 9Fairfax and Seven?
Have you tried the other search engines? Anyway, all those other businesses pay their taxes, shouldn’t Google?
Whataboutery?
While I completely agree, this is a different issue. It is worth noting the contrast between the government’s vigorous prosecution in favour of News Corp’s bottom line vs. its inaction over profit-shifting and tax evasion.
Who will the LNP side with?
They will side with their owner, uncle Rupert, of course.
“…the company’s threat to rob users of its search engine.”
How can you rob somebody of something they do not own and do not pay for?
People whinge especially loudly if something they don’t own and which is free is taken away. But in this age, usually another source pops up before long.
As a technologist myself, I’ve seen the tech pendulum swing many times. A broad example is mainframe (centralised service) to desktop (distributed, user run) back to mainframe 2.0 (a.k.a. cloud, a centralised service). In short, everything today is “someone else’s computer”. Do you own your own media anymore? No. Do you own search? No, you never have. We live in a world where services can come and go, both in digital and non-digital. Individually, we can all do well to think about our own appetites for independence, and inter-dependence, in just about everything we do.
Yes – it is laughable that Canberra Parliamentary denizens are trying to regulate social change in the worlds well as technical change – bring back fax communications only –
Faxes? Pah! Bring back the Telex machines!
I’m rather fond of morse code myself.
Carrier pigeons for me!
We seem to have lost track of what the real issues are here. Google and others are engaging in information piracy and avoiding paying taxes. I don’t really know why Australia yet again seems to want to go it alone. Again. I don’t think it would be too difficult to garner international support for greater regulation. Unless Scomo is relishing the ‘look over there’ factor.
How on Earth is what Google does piracy? The links still take you to the news providers, they only provide you with the headline and an excerpt from the first paragraph.
If this law goes through, won’t it be the death of those news providers as Google just directs searches elsewhere (e.g. the ABC)?
Is that so. Then why did Google agree to pay US news publishers $1.4B last year. Spain forced Google to remove their local news service.
As she is reported, appears SHY has lost the plot. Google do have amazing market power but the government has “amazing” telecommunications powers and in this case is basically trying to extort ongoing rent-seeking for big media, presumably as dictated to them by the Murdoch media.
It wouldn’t cost Google much to freeze out Australia for six months or so, causing significant disruption and economic cost.
I suspect this big stick has been raised because the smaller stick, not linking to news sites or ranking them to be pages deep in results, has been found to have limited effects. Apparently Google did this in Spain some years ago but it has not been as devastating to Spain’s media as was thought. Still we are part of the Anglosphere and there is a lot of o/s media sites we could be shown first by a rejigged Google search.
The idea that referring someone to a revenue earning website should incur a fee for the referrer is pretty ludicrous. It requires a level of cognitive dissonance fuelled by some sort of misplaced means justify the ends desire. Something politicians aren’t short on, it has to be admitted. I shall continue watching with disinterest.
Cognitive dissonance, maybe – but also a high level of ignorance. The government, apart from showing who they take their orders from (Murdoch), displays a profound lack of understanding of what the web is and how it works. It’s clear that, when they look at a web page, none of them have any idea what they’re looking at.