Google Clashes With Australian Regulators, Threatening To Change Its ‘Free Services’

Australian announced its plan to enforce digital giants to pay for news content. The law is designed to make tech companies pay a fair price for the news content created by others, which the companies benefit.

Following the announcement, the U.S. tech giant Google retaliates and goes offensive.

The company quickly published an open letter on its website to warn Australians that the proposed law that is designed to benefit news agencies would "hurt how Australians use Google Search and YouTube."

Google Australia Managing Director Mel Silva claimed that the measure "could lead to your data being handed over to big news businesses, and would put the free services you use at risk in Australia."

She argued that under the proposed law, Google would have to tell news companies how they could gain access to its users' data, while also being "given information that would help them artificially inflate their ranking over everyone else."

"The way you search with Google is at risk," the message read. "The products Aussies rely on will be hurt by new government regulation."

In a blog post, Gautam Anand, head of YouTube's Asia Pacific business, wrote that:

The Federal Government had previously set the Australian Competition and Consumer Commission (ACCC) to work on a voluntary code of conduct governing the relationships between digital platforms and media businesses. But since the digital companies stalled, the government shifted to create a mandatory code, to simply create a level playing field for all players.

The code proposes “bargaining arrangements” so commercial news companies can determine payment for their news content with tech giants.

But seeing that its proposal angers Google, regulators dispute Google's claims, and are fighting back.

In a statement, the ACCC accused the company of spreading "misinformation" in its open letter.

For example, the claims that said the proposed law "could lead to your data being handed over to big news businesses", is certainly not true. The code would merely require Google to provide news media businesses with information on the user data they collect through users’ interactions with news content.

"Google will not be required to charge Australians for the use of its free services such as Google Search and YouTube, unless it chooses to do so," it said. "[And] Google will not be required to share any additional user data with Australian news businesses unless it chooses to do so."

The code is simply intended to allow Australian news businesses to negotiate fairly and in good faith over payment for the inclusion of news content on digital platform services.

This follows ACCC's accusation that said Google misled consumers when it failed to properly inform consumers about expanded use of personal data, and did not gain their explicit informed consent.

The proposed law targets mainly Google and Facebook, because the two have the most control over the flow on news and information on the web.

With the proposed law, the Australian regulators want to allow certain media outlets to bargain either individually or collectively with Google and Facebook, and to then enter arbitration if the parties can't reach an agreement within three months, according to the ACCC, which put out the proposed legislation.

That process would involve an independent arbitrator to help both sides settle the matter within 45 business days.

ACCC proposed the law because since January 2019, more than 200 newsrooms across the country have experienced reduced service, closed temporarily or permanently shut down. And this proposed law is to level the playing field, by asking tech giants a favor.

Following Google's stance, the ACCC responded in a media release post, saying that it would "continue to consult on the draft code with interested parties, including Google."

When Google retaliates and goes offensive, Facebook took a calmer approach, saying in July 2020 that it was "reviewing the government's proposal to understand the impact it will have on the industry, our services and our investment in the news ecosystem in Australia."