Google stands firm on media code position; withdrawal a ‘worse case scenario’

The public senate committee hearing on the Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2020 took place today, and there were plenty of uncomfortable moments and questions for all parties involved.

First up at the hearing was Google Australia, represented by managing director, Mel Silva.

Silva said Google’s stance throughout the code’s development and final bill before parliament had not changed and that Google was  “very open” to smart regulation and consultative regulation.

The senators on the Economics Legislation Committee were less than impressed by Google’s recent “experiment” to remove Australian news sources from search for 1% of users, and made the tech giant well aware of it, using terms such as “ransom” and “blackmail” to describe it’s behaviour.

Silva appearing before the committee.

Silva said that the experiment was necessary, as there is an area in the proposed workable code that requires them to understand the value between Google and the publishers.

“We needed the data and insights to prepare,” she said. “There are a number of scenarios we have been planning for at Google, the worst case scenario which I have outlined is the withdrawal of Google [from Australia] which is something we want to avoid.”

Senator Andrew Bragg stated that Google was used to a “light regulatory burden” and that the organisation had an issue with being regulated, to which Silva responded that Google responds to and is open to consulting with governments on regulation globally.

“We would love to have a workable code” said Silva. “The concept of freely linking on the web is important not just to how the web operates, but how Google operates.”

Senator Sarah Hanson-Young said that this behaviour was evidence that it is “Google’s way or the highway” and that is was a “hell of a threat” that did not add up with the facts that you have presented.

Last year, Google paid A$59 million in corporate tax in Australia, off the back of $4.8 billion in revenue.

When asked if Google would commit to paying more tax by Hanson-Young, Silva responded: ”We have never withdrawn from a market for paying tax, and that exists in other markets.”

She added that withdrawing from Australia was a  “worst case scenario”.

“We do not want to be in this situation, we would love to be in a situation where there is an outcome where there is a workable code for all parties that meets the intention that the government set. Which is to provide a bargaining framework for commercial negotiations in good faith,” she said.

“We have built a business on the concept of freely linking websites. The concept of paying a very small group of websites or content creators for appearing purely in our organic search results sets a dangerous precedent for us that precedents unmanageable risk.

“We don’t see a way with the financial and operational risk that we could continue to offer a service in Australia… Combination of forced payment for links and snippets, with the arbitration criteria, which is open ended creates an unmanageable risk for us.”

More to come from Facebook, AAP, News Corp, Nine and The Guardian.


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