Google threat proves laws are needed
GOOGLE'S threat to withdraw services from millions of Australians to evade a law was a "sobering" demonstration of its monopoly power, a Senate inquiry heard today.
The second Senate hearing into Australia's news media bargaining code also heard backing away from regulating the US firm would show "big tech is now more powerful than our elected government."
And it was claimed the tech giant's argument that paying to share news would "break the way Google Search works" was "disingenuous at best … misinformation at worst," and fielded proposals for more small outlets to be included in the code.
However, Google launched a new public campaign against the laws on the same day, adding an advertisement to its Australian home page.
The Senate hearing into the News Media and Digital Platforms Mandatory Bargaining Code heard testimony that Google's threats to remove its search engine from Australia was proof that digital platforms urgently needed to be regulated.
Reset Australia policy lead Matt Nguyen said Google's exit, its "experiment" to hide news stories from some users, and Facebook's plan to remove all news content from its social network in Australia demonstrated the companies' overwhelming market power.
"Over the last few weeks we have experienced the sobering power these platforms have over our lives," he told Senators.
"Big tech has threatened to pull services from the country, they have altered the content that thousands of Australians see in the name of a media stunt, and they have actively used the monopoly control over information markets to try and influence Australian opinion.
"This reveals an entrenched disregard for community welfare and threatens to undermine Australia's public decision-making processes."
Australia Institute's Centre for Responsible Technology director Peter Lewis said the tech giants' were showing how serious they were about avoiding a global precedent to pay for news, and warned the Australian government could not afford to back down from the proposal.
"Right now Australia is being confronted with big tech's big stick; the threat to kill one in order to warn one hundred," he said.
"Capitulation will be a recognition that big tech is now more powerful than our elected government; a proposition that is just not sustainable."
Several speakers at the inquiry's second hearing welcomed the news code but proposed changes or expressed concern at the digital platforms' threats to leave Australia.
Media Entertainment and Arts Alliance media director Adam Portelli proposed Australian news organisations with an annual revenue of $75,000 or more - rather than $150,000 - should qualify for payments under the code, and those payments should be invested directly in hiring journalists.
Country Press Association president Bruce Ellen said news start-ups should also be allowed to register for payments if they could demonstrate they would reach the financial target within three to six months to bolster independent news organisations in regional areas.
However, Junkee Media chief executive Neil Ackland warned small outlets in Australia had a lot to lose as, while it supported the code, a news ban by Google and Facebook could "be fatal for businesses like ours and other small publishers".
Google underlined its threat to remove its search engine from Australia and "serious problems" it had with the laws in a new blog post advertised on its Australian home page.
The 1700-word post said Google considered "several aspects of the current version of this law … unworkable for the services you use and our business in Australia" and its requirements to pay for links would "break the way Google Search works".
But Swinburne University media senior lecturer Dr Belinda Barnet told the inquiry this explanation was "disingenuous at best and misinformation at worst" as Google regularly charged companies to advertise web links.
"If extracting payment for links or views or clicks or snippets is breaking search, they've already broken it," Dr Barnet said.
"These platforms have been extracting data for every click and scroll and hover for years now, from you. Then they charge advertisers to place advertising based on your data."
Treasury markets group deputy secretary Meghan Quinn said "the Government does consider the code is workable" and analysis into the impact of Google and Facebook's threats were "ongoing".
"If they were to withdraw some services, there are substitutes available for people to go to," she said.
The Senate inquiry into the news bargaining code is due to issue a final report on February 12.
Originally published as Google threat proves laws are needed