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Alphabet Inc.’s Google said on Friday it would block its search engine in Australia if the government proceeded with a new code that would force the company and Facebook to pay media companies for the right to use their content.
The Google threat increases the battle with publishers like News Corp, which is being watched closely around the world. The search giant had warned that its 19 million Australian users would face a degraded search and YouTube experience if the new code were applied.
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Australia is about to pass laws that would make technology giants negotiate payments with local publishers and broadcasters for content included in search results or news feeds. If they fail to reach an agreement, a government-appointed arbitrator will decide the price.
“Coupled with uncontrollable financial and operational risk, if this version of the Code were to become law, it would give us no real choice but to stop making Google Search available in Australia,” said Mel Silva, managing director of Australia and New Zealand a senate committee.
Silva made no mention of YouTube in prepared comments.
Google’s comments drew a strong rebuke from Australian Prime Minister Scott Morrison, who said the country sets its rules for “things you can do in Australia”.
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“People who want to work with this in Australia are very welcome. But we don’t respond to threats,” Morrison told reporters.
Google classified the code as too broad and said that without revisions, even offering a limited search engine would be too risky. The company does not disclose sales from Australia, but search ads are its biggest contributor to revenue and profit globally.
| Ticker | Safety | Last | change | Change % |
|---|---|---|---|---|
| GOOGL | ALPHABET INC. | 1,884.15 | +4.08 | + 0.22% |
The United States government this week asked Australia to reject the proposed laws, which have broad political support, and suggested that Australia should seek a voluntary code.
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Australia announced the legislation last month after an investigation found that Google and social media giant Facebook have a lot of market power in the media industry, a situation that poses a potential threat to the smooth functioning of democracy.
Google’s threat to limit its services in Australia came just hours after the internet giant reached a content payment agreement with some French publishers as part of a $ 1.3 billion three-year effort to support publishers .
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Google’s testimony “is part of a threatening pattern of behavior that is frightening for 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)