Google has launched a brazen attack on the Australian press and threatened to end free web searches after the country’s media watchdog said the tech giant should pay for news content.
Anyone using the search engine in Australia is now confronted by an abrasive yellow exclamation mark with a link to an ‘open letter’ which attacks the Australian Competition and Consumer Commission.
The AACC’s draft law – created at the behest of the chancellor, Josh Frydenberg – mandates that a sliver of the colossal $6billion ad revenue generated by Google and other tech giants like Facebook, goes to news corporations.
The battle between Canberra and Silicon Valley will be watched keenly by governments across the world, including London and Washington, which have raised concerns over the ‘advertising duopoly’ operated by Google and Facebook.
Google has been accused of spreading ‘misinformation’ by claiming Australians will be denied free internet searches if tech giants like them are forced to pay for news they use
Anyone using the search engine is now confronted with a yellow exclamation mark with a link to a so-called ‘open letter to Australians’ from the company’s managing director in Australia Mel Silva
In the United Kingdom, 36.7% of all online advertising revenue is earned by Google and 28% by Facebook. The online advertising market was worth £13.5billion in the UK last year.
Australians are today being greeted by a strongly-worded letter from Google’s managing director in Australia Mel Silva.
Google’s ‘s managing director in Australia Mel Silva: ‘We need to let you know about new government regulation that will hurt how Australians use Google Search and YouTube’
Those who click on the link are confronted with a warning about the end of free internet searches and data being ‘handed over to big news businesses’.
‘We need to let you know about new government regulation that will hurt how Australians use Google Search and YouTube,’ Ms Silva’s letter said.
‘A proposed law, the News Media Bargaining Code, would force us to provide you with a dramatically worse Google Search and YouTube, could lead to your data being handed over to big news businesses, and would put the free services you use at risk in Australia.’
But Australia’s consumer watchdog which has proposed making the tech giants pay media organisations for news items shown on their platforms has hit back – accusing Google of not telling the truth.
‘The open letter published by Google today contains misinformation,’ Australian Competition and Consumer Commission boss Rod Sims said.
Last month, the ACCC declared Google and Facebook would be forced to pay media companies for the right to use their stories or face fines of up to $10million for breaching a copyright deal.
In a world first, the competition regulator is proposing a new draft code directing the American search engine and social media giants to negotiate fair payment deals with commercial media outlets.
Google hinted its rankings would end up favouring news outlets that had entered into commercial arrangements with them under the ACCC proposal.
The Australian Competition and Consumer Commission has accused Google of releasing a letter that ‘contains misinformation’
‘The law would force us to give an unfair advantage to one group of businesses – news media businesses – over everyone else who has a website, YouTube channel or small business,’ Ms Silva said.
‘News media businesses alone would be given information that would help them artificially inflate their ranking over everyone else, even when someone else provides a better result.
‘The proposed changes are not fair and they mean that Google Search results and YouTube will be worse for you.’
Ms Silva also claimed Google would have to hand over data to media companies.
‘You trust us with your data and our job is to keep it safe,’ she said.
‘Under this law, Google has to tell news media businesses “how they can gain access” to data about your use of our products.
Swinburne University senior media lecturer Belinda Barnet, who specialises in social media, pointed out Google’s parent company Alphabet had fourth-quarter earnings of more than $US45billion. The earnings added up to $US38.3billion or $A53billion
‘There’s no way of knowing if any data handed over would be protected, or how it might be used by news media businesses.’
Mr Sims strongly disputed Google’s open letter and said it would not be required to ‘charge Australians for the use of its free service such as Google Search and YouTube, unless it chooses to do so’.
‘The open letter published by Google today contains misinformation about the draft news media bargaining code which the ACCC would like to address,’ he said.
Mr Sims said the draft code was designed to address ‘a significant bargaining power imbalance between Australian news media businesses and Google and Facebook’.
‘A healthy news media sector is essential to a well-functioning democracy,’ he said.
Swinburne University senior media lecturer Belinda Barnet, who specialises in social media, pointed out Google’s parent company Alphabet had fourth-quarter earnings of more than $US38.3billion ($A53billion).
‘Oh cry me a river, Google,’ she tweeted.
ACC chairman Rod Sims strongly disputed Google’s open letter and said it would not be required to ‘charge Australians for the use of its free service such as Google Search and YouTube, unless it chooses to do so’
‘A trillion-dollar company with Q4 earnings of $46 billion is trying to convince YOU that sharing a *teeny tiny fraction* of their earnings with Australian media outlets is somehow dangerous.’
Under the ACCC’s draft code, a maximum penalty of $10million would be imposed on the multinational companies if Google or Facebook breached a deal to share content and were convicted in the Federal Court.
The digital giants could also be fined the equivalent of three times the commercial benefit they obtained from illegally sharing the news content, or ten per cent of their annual revenue in Australia during the past year.
Under the proposed new arrangement, Google and Facebook would be forced into third-party arbitration with media companies if they failed to reach an agreement with them.
An independent umpire would make a decision within 45 business days.