This weekend brought a lot of heated bluster from old media (and its political representatives) about Google’s supposed threat to democracy.
In Senate hearings on Friday, Google Australia head Mel Silva confirmed the company would pull the search engine from Australia if the federal government hurried ahead with its mandatory news bargaining code as currently drafted. This confirmed Crikey’s report the week earlier: the code, as is, means no Google search.
It gave Scott Morrison a Howard moment — “we’ll decide who searches Australia and the manner in which they search!” — as he huffed, “we don’t respond to threats”. (This will surely be news to anyone who follows the LNP-News Corp relationship.)
Morrison was wrong as a matter of law. The Australian Parliament is constrained by the Howard-era Australia-US free trade agreement, and the US trade representative last week raised concerns that the code may breach the agreement.
This allowed tech reform campaigners to highlight the demonstration of big tech’s raw power, even at risk of an “enemy of my enemy is my friend” embrace of News Corp. Meanwhile, people on social media canvassed alternatives from the not-for-profit search engine DuckDuckGo to Microsoft’s Bing to a VPN (virtual private network) to access Google offshore. Australia would no doubt adapt in some way.
On the way through, however, a Google-less Australian internet threatens a crisis for small businesses which rely on a hyper-local market (that is, most of them). In Australia, as in most of the world, among the most common words at the end of any search are “near me”.
A December report (funded by Google) on the search engine’s economic impact on Australia concluded that the company provided $39 billion of value to Australian businesses, 60% of it to small and medium businesses.
As the Mandy Rice-Davies heuristic goes: they would say that, wouldn’t they?
Still, search and social media distribution has inarguably provided greater and cheaper advertising opportunities for small businesses — from keywords in general search to Google’s geographical interfaces Maps and Waze. As we mourn the loss of local newspapers, Google and Facebook have given these businesses the ability to micro-target new and existing customers.
Thousands of local businesses have shaped their offering and their branding around the opportunities they’re offered. There will be transition costs if they’re now forced to change (for lesser alternatives) and, coming in the midst of the pandemic, it will tip more than a few businesses over the edge.
This is a reminder that there are no good guys in the big tech v old media fight. When the elephants butt heads, the ants get trampled.
Here’s the key: the fight is not about whether the big platforms will pay for journalism. That’s agreed. It’s more about how much they pay and what they pay for.
Google is offering to pay for articles that are published in its editorially curated News Showcase which leans towards journalistic quality, small media and sits outside paywalls. That’s the deal it reached with French publishers, most German publishers (other than the Murdoch-lite Springer group) and Reuters.
News Corp (in particular) wants payment for links and snippets in the search results. Algorithmically this leans towards mass media and outrage clickbait. It would also respect paywalls.
Why does Google care? It says that paying for links shatters its business model which leverages the open web, commercialising all online interactions. That’s what it (and web creator Tim Berners-Lee in his own Senate submission) mean when it says it “undermines the basic principles of the internet”. It concludes it will worsen all the tracking and surveillance that the platform advertising duopoly of Google and Facebook has brought to the web.
Why does News Corp care? Before Christmas, its New York CEO Robert Thomson confirmed an earlier Crikey report that it was close to a global deal with Google, to match its late 2019 deal with Facebook. Now that seems to have gone cold and Google is ramping up its opposition.
Perhaps the Google price of cancelling Australia’s mandatory code was too steep. Perhaps Google fears that, especially in the US right now, there’s a reputation risk in reaching a “news” related deal with News Corp.
What do you think a Google-less Australia would look like? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name to be considered for publication in Crikey’s Your Say column.
Asking Google to pay for content sourced by its own algorithms just because it seriously affects the business model of the old media companies is akin to asking Henry Ford to pay for horse feed for horse and carriage operators because he has trashed their business model.
Not a sustainable analogy Rob. Google profit from the products of the various news organisations. Old? New? Totally irrelevant. It’s their product and they can charge for it. A better analogy is Google as a Strangler Fig. It props itself up on existing businesses…..then swallows them up.
It’s more akin to Sensis offering News Corp free ads in the Yellow Pages, News Corp accepting the offer, then demanding compensation because Sensis takes payment for other ads.
The fact is that News Corp (and everyone else, including you!) can ask Google not to index their site, can set a meta tag to disable snippets on any article (web page) they choose, and can set a meta tag to ensure any article (web page) they choose doesn’t appear in organic search.
News Corp don’t do this because appearing in organic search generates traffic — for free — that can subsequently be monetised. And all of our media do monetise that traffic, collectively to the tune of hundreds of millions of dollars a year.
That folks commenting here and elsewhere believe otherwise shows how just how effectively a consolidated media landscape disseminates propaganda.
The new showcase is a whole other proposition, but it doesn’t seem Google objects to doing a deal here; if only News Corp would produce some news that was fit to print.
Oh I love your reference to Sensis which undertook extensive search engine research and testing in 1996 which is now part of the Google search engine
If this Federal Liberal Government pushes ahead with their attack on Facebook and Google it is effectively an attack on free speech via personal comments and links to news on these sites. The PM has said “we don’t respond to threats”, sorry PM, you will be judged on this at the polls.
We voters are sick and tired of the propaganda you pedal via the commercial media.
Morrison might not respond to threats but he’s not afraid of dishing them out eg Christine Holgate, the ABC, the funding of ANAO, the refusal to implement an ICAC, etc.
Free speech, blah blah, free speech. If we don’t complete comply with the world’s greatest monopolies it’s an attack on free speech.
Is that your argument? How did this get upvotes?
At the risk of either increasing Wayne’s up-votes or attracting down-votes I believe the assertion to be that the electorate is so rusted to anything Goggle has the risk of loss of enjoyment will surfice to bring down the government.
I think the fellow intends ‘free to choose’ rather that speech.
I’ve given you a down-vote just to ensure your score stays up.
I could not ask for a more appropriate Oz Day gesture.
This could be a breakthrough for Labor. There’s going to be a lot of annoyed people when they can’t find their favourite shop or recipe.
They say science underpins the post scarcity 24/7 consumer society .My money wagers that shopping underpins it..
I suppose you’re joking. Just as Labor always cops the blame for any economic troubles despite the Coalition’s shocking record and incompetence, any difficulties arising from Google’s disappearance will be Labor’s fault entirely.
Probably right if they support the legislation. Their choice.
And they will support it – there isn’t an anti liberty idiocy put forward by the tories since 2013 (or 1996 under bumbler Beezleblubber) that they have not waved through.
A good opporutnity for promoting digital and critical literacies amongst not just school age, but adults especially.
Yeah,they might find that they have to interact with those bipedal mammals often seen on the street.
This is Google V the Australian Government (A Wholly Owned Subsidiary of News Limited). Once again the Morrison government picks a fight with a giant because it suits their mates. Google’s unavailability in Australia doesn’t matter – VPNs make that impossible. Australian-based profits for Google must rate somewhere between zero and a rounding error when taken with markets world-wide. The whole thing rates as ‘who cares’.
VPNs won’t work for everyone. Most people I work with use google multiple times daily for all kinds of information searches – I don’t think my organisation is going to support moving to a VPN. Losing the google search function has the potential to substantially impact productivity in many businesses, NGOs, and even government. And what of google scholar? We lose that too? This isn’t just an impact-on-small-business story. Most people have passwords stored in google, as well as bookmarks (in my case 100’s of them). It is a serious inconvenience to lose those. And finally, google search is good. It emerged as the front runner among many competitive alternatives 20 years ago. People willingly chose to use it. If it were that easy to replace, it would have been done long before now.
Google makes billions in Australia and pays bigger all tax, shipping it out to low tax countries and hiding it in other ways. It’s not their main game, but it is staggering amounts of money.
I care that there business model is to pay no tax, couldn’t give a fig about legacy media.
Alas, that seems to be the MO of far too many companies & inividuals in this country.
Between transfer pricing, internal loans, copyright & consultant fees and manifold other abuses it is obvious why 70%+ of federal revenue comes from the long suffering PAYE punter.
No, small business won’t survive a Google-less Australia. The problems of legacy media models and weathly old media barons are a side issue to what Google search delivers to small business. As a specialist tourism operator in Australia and South America, Google search makes our business visible and successful. It does so alongside much bigger businesses and in key markets around the world for little or managable cost.. More than 40% of customers say they find us using Google.
As for the comments suggesting an Australian search solution will fix the hole left by a Google exit, just call me when its ready. Google is many things to many people. I see a gross underestimation of the impact its departure will have on SMEs amongst the comments here. ‘Search’ in Australia could be a little like the joke NBN internet service we’ve ended up with, kinda works but it’s definitely not first world. Move on Australia, this is another flight that needs to be carefully handled by experts rather than clumsy politicians.
Some useful points Paul but how do you feel about 100% dependence? Agreed, there is no short term solution other than rolling over by Oz but the issues identify some strategic holes.
By way of an example, Japanese companies are less then sanguine about having majority interests in the PRC when the PRC can flick the switch (as occurred) without an hours’ warning.
Good overview and rather than attacking Google the government, at all levels, could be doing more in supporting training for sole, small and medium sized businesses in developing their web presence locally, nationally and globally; generally known as innovation in the ‘clever country’.
The ATDW’s marketing e-kit for tourism operators was an excellent digital marketing resource not appreciated so much in Oz, although applicable across sectors, not just tourism.
When it was first released ten+ years ago, free, majority of downloads were offshore understanding the value while onshore some interest, but there is often resistance to changing habits.
I can imagine many sole, small and medium businesses leveraging SEO well, would be very upset with the LNP ‘small business party’ continuing to blow up their business models to help a few ‘top people’ and their legacy media outlets…..