Google is threatening to stop the search function in Australia

During a Senate hearing in Canberra on Friday, Google (GOOGL) Australian Managing Director Mel Silva said the bill “remains unworkable” and would “break” the way millions of users searched for content online.
“If this version of the Code were to become law, we would have no choice but to make Google Search no longer available in Australia,” she told lawmakers. “That would be a bad outcome, not only for us, but also for the Australian population, media diversity and small businesses using Google Search.”

The company’s main concern with the proposal is that it “requires payments for links and snippets only for news results in Google Search,” Silva said.

“The free service we provide to Australian users, and our business model, is based on the ability to link freely between websites,” she said.

Google and Facebook have struggled with publishers over how they display their content for years, with media companies feeling the tech giants should pay them for the privilege. Critics of the two tech companies point out that since they dominate the online advertising business, it gets news outlets in trouble and makes them hunt for leftovers.

Under the new legislation, certain media outlets could negotiate individually or collectively with Facebook and Google – and enter into arbitration if the parties cannot reach an agreement within three months, according to the Australian Competition and Consumer Commission, which announced the proposed legislation.

Australian Prime Minister Scott Morrison hit back at Google later on Friday.

“Let me be clear. Australia sets our rules for things you can do in Australia. That’s happening in our parliament. It’s done by our government and that’s how things work here in Australia and people who want to work with them in Australia, you “are very welcome,” he said at a news conference. “But we do not respond to threats.”

When asked about Morrison’s comments, Google declined to comment.

A warning of ‘consequences’

Both US tech companies have been vehemently opposed to the code since its introduction last summer. Last August, Google used its homepage to warn Australians that the bill would hurt their search ability and “impact” YouTube users.
Google's clash with Australian regulators is growing

The US giant is now proposing three changes to the code, including how it would compensate news outlets.

One suggestion is that News Showcase – a program launched by Google last year that aims to pay publishers more than $ 1 billion in the next three years – be formalized and expanded in Australia. The company already pays seven publishers in the country for content.

The company also wants to amend a requirement that would force Google to notify publishers of changes to its algorithm, saying it should do this only “to ensure that publishers can respond to changes that affect them” .

“There is a clear path to fair and workable code,” said Silva. “Withdrawing our services from Australia is the last thing I or Google want to happen, especially if there is another way forward.”

An aggressive fight

Facebook (FB) also pushes back.

In the same Senate hearing on Friday, Simon Milner, Facebook’s vice president of public policy for Asia-Pacific, said the company could eventually block news content in Australia, although he stressed the promise “to make the law workable.”

Milner told lawmakers that there was already “a deterrent effect of this law on investments in the Australian news industry,” citing a recent decision by Facebook to launch a news product in the UK rather than Australia.

Sir Tim Berners-Lee said that this precedent set by this law ‘could make the web unworkable around the world,’ he added, citing the inventor of the web.
Google agrees to pay French publishers for news

Regulators say the legislation is needed to level the playing field for the news media in Australia, as newsrooms across the country have reduced service, closed temporarily or closed permanently.

Similar cases have emerged in other countries. On Thursday, Google announced that it would pay news outlets in France for using their content online in a groundbreaking agreement that could soon be replicated elsewhere in Europe under new copyright laws.

– Hanna Ziady contributed to this report.

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