Google threatens to cut off Australia

Google has made an unprecedented threat to shut down its Search operation in Australia as it tries to force the government to back away from new legislation that would force it to pay media organisations to carry their news content and conduct mediated negotiations with them if agreements cannot be reached.

The law was proposed at the end of 2020 following an investigation into the dominance of both Google and Facebook in online news content. The Australian government believes this poses a threat to democracy in the country.

This has drawn criticism from both organisations – Facebook is also threatening to stop carrying news content in the feeds of its Australian users – as well as the US government, which has pressured Canberra to change its mind.  

In a statement to Australia’s Senate Economics Committee Inquiry, which is holding hearings on the legislation, Mel Silva, Google vice-president for Australia and New Zealand, said: “Google is committed to achieving a workable News Media Bargaining Code. But in its current form, the Code remains unworkable and if it became law would hurt not just Google, but small publishers, small businesses, and the millions of Australians that use our services every day.”

Silva said the requirement under the code to pay for links and snippets in search would set an “untenable” precedent both for Google and the wider digital economy. Google claims that around 19 million Australians use its service every month, conducting about 95% of all internet searches in the country.

“It’s not compatible with how search engines work, or how the internet works, and this is not just Google’s view – it has been cited in many of the submissions received by this Inquiry,” said Silva.  

“The principle of unrestricted linking between websites is fundamental to Search. Coupled with the unmanageable financial and operational risk 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.”

“That would be a bad outcome not just for us, but for the Australian people, media diversity and small businesses who use Google Search.”

Silva added: “Withdrawing our services from Australia is the last thing that I or Google want to have happen – especially when there is another way forward.”

Google is proposing technical amendments in three areas that it believes would address the problems it has identified, including applying its recently launched News Showcase product more widely, tweaking the arbitration model to a more standard commercial one, as opposed to a final offer model, and adjusting the algorithm notification provision.

The organisation counts some of the online world’s most celebrated pioneers in its corner, among them World Wide Web inventor Tim Berners-Lee, who in a submission to the Senate Committee said that requiring payment for a link on the web blocked an important aspect of the value of online content.

Berners-Lee said that although fairly compensating journalists, publishers and other content creators for their work online was without doubt an issue that needed to be solved, constraints on the use of hypertext links were not the way to do it.

“It would undermine the fundamental principle of the ability to link freely on the web, and is inconsistent with how the web has been able to operate over the past three decades,” said Berners-Lee.

“If this precedent were followed elsewhere, it could make the web unworkable around the world. I therefore respectfully urge the committee to remove this mechanism from the code.”

Vint Cerf, one of the original architects of the internet itself, said it would be a mistake for Australia to alter one of the internet’s fundamental mechanisms in order to solve the long-term structural problems faced by news publishers.

“The risk with the way the Code is proposed currently in Australia is that it would fundamentally undermine this openness of the internet and the economic model that stems from it, forcing information to be consumed in a particular manner, favouring a narrow range of sources for the diffusion of content and knowledge, and thus also undermining democratic discourse and media diversity,” said Cerf.