Google threatened to disable its search service for Australias unless the government changed landmark legislation where Google is forced to pay local publishers for news. The legislation was introduced last year and is one of the most aggressive moves globally to check the power of the US tech giant.
Google Australia managing director Mel Silva described the law as “unworkable” and warned a Senate committee in Canberra on Friday that the world-first media law would undermine the functioning of the internet. She opposed the condition that Google pay media companies for displaying excerpts of articles in search results.
This is Google’s most powerful threat, yet as the digital giant tries to stem a flow of regulatory action worldwide, such a radical step would see its rivals taking over an entirely developed market. According to the local competition regulator, at least 94% of online searches in Australia go through the Alphabet Inc. unit.
“We don’t respond to threats,” Australia Prime Minister Scott Morrison said Friday, according to Bloomberg. “Australia makes our rules for things you can do in Australia. That’s done in our parliament. It’s done by our government. And that’s how things work here in Australia.”
Along with Google, Facebook Inc. is also targeted by the legislation. The social media platform also opposes the law and reiterated at Friday’s hearing that it is considering blocking Australians from sharing news on Facebook if the law is pushed through.
The legislation is designed in a way that it supports the local media industry, including Rupert Murdoch’s News Corp., which has struggled to adapt to the digital economy. Senator Andrew Bragg accused Google of trying to blackmail Australians and policymakers as the tech giant’s tougher stance drew rebukes from lawmakers at the hearing.
“If this version of the code were to become law, it would give us no real choice but to stop making Google Search available in Australia,” Silva told a panel of senators. She described the law as an “untenable financial and operational precedent.”
But Google has faced similar requests in other countries and it has adapted to it without cutting off the search engine. The California-based company stopped showing news results from European publishers for French users on search results last year as they were urged to pay for content by local regulators, and then on Thursday, the firm said it reached a deal to pay media publishers in the country. In 2014, following new copyright legislation, it shuttered Google News in Spain.
‘Control and Power’
Johan Lidberg, an associate professor at Melbourne’s Monash University called Google a corporate bully, “It’s about control and power,” Lidberg, who specializes in media and journalism, said. “They’re signaling to other regulators they’ll have a fight on their hands if they do this.”
Silva proposed Google’s News Showcase was proposed by Silva as an alternative to the Australian legislation, in this arrangement, the company pays select media outlets to display curated content. Senator Bragg said it was impossible to assess its value to the local market since the service isn’t available in Australia.
“All we’ve got today is your threats and your blackmail,” he told Silva.