SYDNEY, Jan. 22 (Reuters) – Google said Friday that it will disable its search function in Australia if the government proceeds with a media code that would force the company and Facebook Inc to pay local media companies to share their content.
Australia is on track to pass laws that would force the Big Tech giants to negotiate payments with local publishers and broadcasters for content. If they can’t close a deal, a government-appointed arbitrator will set the price.
“The code’s arbitration model with bias criteria poses an unmanageable financial and operational risk to Google,” Mel Silva, Australia and New Zealand chief executive officer, told a senate committee.
“If this version of the code were to become law, we would have no choice but to no longer make Google Search available in Australia.”
Australia announced the legislation last month after an investigation revealed that Google, owned by Alphabet Inc, and social media giant Facebook had too much market power in the media industry, a situation it said posed a potential threat to a functioning democracy.
The United States government this week asked Australia to scrap the proposed laws, which have wide political support, and suggested that Australia should instead follow a voluntary code.
Google’s threat to restrict its services in Australia came just hours after the internet giant reached an agreement to pay for content with a number of French news outlets.
Google’s testimony “is part of a pattern of threatening behavior that is chilling to anyone who values our democracy,” said Peter Lewis, director of the Australia Institute’s Center for Responsible Technology.
Reporting by Renju Jose Editing by Byron Kaye and Gerry Doyle