Google threatens to stop Search in Australia over new law

Ruben Fields
January 22, 2021

The code would initially apply to Facebook NewsFeed and Google Search. The news has caught wide media attention, as you would expect, but also sets a huge precedent that can change the web as we know it. I'm joined by Lucinda Longcroft, the Head of Government Affairs and Public Policy for Australia and New Zealand.

The free service we offer Australian users, and our business model has been built on the ability to link freely between websites - this is a key building block of the internet. In response, Google has threatened to disable Search in the country if the new code is passed, and the threat has understandably not gone down well down under.

Can you imagine loading up Google's search page and there's nothing there?

The legislation was introduced past year to force Google and Facebook to pay local media organisations to host news content or face millions of dollars in fines, in one of the most aggressive moves globally to check the power of the two USA digital giants.

Google Australia managing director Mel Silva told the Australian Senate that the laws were "unworkable".

Silva told the committee that withdrawing our services from Australia is the last thing that "I or Google want to have happen - especially when there is another way forward".

"It is the only rational choice if this law were to pass for us". But Google News Showcase only figures in Google News within its ambit and excludes links and snippets that show up in Google Search.

Australia's Competition and Consumer Commission (ACCC), which drafted the law, suggested past year that this shouldn't affect Google's search business.

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But the Australian law relies on antitrust provisions and would have a more far-reaching financial impact on Google and Facebook. With only slight amendments, the Code can support Australia as a world-leader in news innovation, media diversity, and consumer choice without sacrificing the benefits that Google provides to large and small businesses in Australia.

She said the code's biased arbitration model also posed unmanageable financial and operational risks for Google. Getting tons of web traffic is worthless to an organisation that can't sell ads against that traffic. It alleged that Google and Facebook takes a third of every AUD 100 spent on online advertising (except classifieds) in Australia.

With companies reducing their digital advertising spend, a number of outlets in Australia have been forced to close.

Google and Facebook are definitely not happy. Of course, if Google left Australia, that would not be great for searchers there.

The company also wants to amend a requirement that would force Google to notify publishers about changes in its algorithm, saying it should do so only "to make sure publishers are able to respond to changes that affect them".

"If you care about Australians and Australian businesses - why would you make this threat?" she said.

"The US Government is concerned that an attempt, through legislation, to regulate the competitive positions of specific players ... to the clear detriment of two US firms, may result in harmful outcomes", said the document, submitted to the Australian government by Assistant US Trade Representatives Karl Ehlers and Daniel Bahar.

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