Highlights:
- On Friday, Google has threatened to stop its search engine in Australia if the country enforced its new law to make tech giants pay media companies content fee
- Google warned that its 19 million Australian users will face the ban of search engine
- The Prime Minister of Australia, Scott Morrison, has hit back at the tech giant
Google said on Friday that if the Australian government continues with a new law that would require it and Facebook Inc to pay media companies for the right to use their content, it would block its search engine in Australia. A war with publishers such as News Corp, which is being closely watched around the world, is escalating Google’s threat.
If the new law is introduced, Google had warned the ban of search and YouTube would be faced by its 19 million Australian users. Australia is on track to pass laws that will require tech companies settle fees for content used in search results or news feeds with local newspapers and broadcasters.
Mel Silva, managing director for Australia and New Zealand, told a Senate committee that if they can’t make a settlement, the price will be determined by a government-appointed arbitrator. The MD for Australia and New Zealand further said, “If this version of the Code were to become law, combined with the unmanageable financial and operational risk, it would leave us with no choice but to stop making Google Search available in Australia.”
In the prepared remarks, Silva made no mention of YouTube, as the video service is supposed to be exempted under the code revisions last month. Google’s remarks drew a strong response from Australia’s Prime Minister, Scott Morrison, who said the country is making rules on things you should do in Australia. Morrison while talking to the reporters also added, “You are very welcome to people who want to work with that in Australia. But we are not responding to threats.”
Rod Sims, chairman of the Australian Competition and Consumer Commission, who has overseen the new rules, said at the inquiry that he could not foresee what the tech giants will do, but said that “there is always brinkmanship in serious negotiations. They speak of commercial deals where the deal is in full control,” he said. “That’s not a commercial deal, in my view.”
Google has called the code too broad and claimed that it would be too dangerous to provide even a restricted search tool without revisions. The company does not disclose Australian revenues, but search advertising are its main contributor to worldwide revenue and profit. This week, the U.S. government urged Australia to drop the proposed law, which has strong political support, and indicated that Australia should instead pursue a voluntary code.
Australia announced the legislation last month after an inquiry found that so much market control in the media industry was exercised by Google and social media giant Facebook, a situation it said posed a possible challenge to a well-functioning democracy.
As part of a three-year, $1.3 billion drive to help publishers, Google’s threat to restrict its offerings in Australia came just hours after the Internet giant signed a content-payment deal with some French news publishers. Peter Lewis, director of the Australian Institute’s Centre for Responsible Technology, said that Google’s testimony “is part of a pattern of threatening behavior that is chilling for anyone who values our democracy.”
