Google has threatened to disable its search function in Australia while Facebook threatened to ban news content from its platform if the government does not back down from its plans to make the tech giants pay media outlets for their content, one of the most dramatic escalations amid ongoing attempts around the world to regulate big tech.
The proposed law would require Google and Facebook to negotiate with local news organizations for content, with a government-appointed arbitrator making decisions if an agreement cannot be made.
Mel Silva, Google Australia’s managing director, said Australia’s proposed ‘News media bargaining code’ is “unworkable” in its current form, undermines the fundamental principle of “unrestricted linking between websites” and constitutes an “unmanageable financial and operational risk” to Google’s Australian operations.
“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 Senate hearing Friday.
Australian lawmakers were unimpressed by the tech giant’s ultimatum, accusing it of “blackmail” and bullying to get its own way.
“Let me be clear: Australia makes our rules for things you can do in Australia,” Prime Minister Scott Morrison said in a withering rebuttal later that day.
“People who want to work with that in Australia, you’re very welcome,” he said, adding: “But we don’t respond to threats.”
The code, designed to help a struggling local media industry that has accused large platforms of benefiting from its work without paying for it, was developed by Australia’s competition watchdog, the ACCC, after talks broke down between it and the tech companies. If passed, it would see the likes of Google and Facebook forced to negotiate and share revenue they make from news content, with the publishers. Facebook and Google, who are exclusively targeted, both argue that news outlets already benefit from the referrals and clicks through to their websites that their platforms enable. The U.S. government has tried to intervene on the tech giants’ behalf, urging the Australian government to work towards developing a “voluntary code,” adding that the code unfairly targets two U.S. firms to their “clear detriment”.
“[The code] would be a bad outcome not just for us, but for the Australian people, media diversity and small businesses who use Google Search,” Silva said.
Google agreed to pay French publishers for their news Thursday after the country’s competition regulator issued a ruling requiring it to do so last year. Google said it would negotiate individual licenses with members of a media lobby group after months of negotiations. Forbes has reached out to Google to comment on the dramatically different outcomes seen in Australia and France over a similar issue.