- Consultation soon closes on a draft code which aims to make Google pay Australian news sites for their content
- Google argues the new ACCC code would force it to hand over user’s data and worsen its Google search engine and Youtube
- Concerns have also been raised the code could unfairly prop up larger news companies over smaller, independent publications
- The tech giant has been running banners on Google and Youtube warning users the code could affect them negatively
- But the ACCC has reiterated the code will fix a current power imbalance between news companies and Google when negotiating pay
- The code won’t affect just Google, it also targets Facebook, who has a prolific news section
- If Google isn’t happy with the code, it can choose to close certain sections of its site to Australian users
- Meanwhile, the Government could always attempt to introduce a digital tax on Google and Facebook
The war of words between Google and the Australian Competition & Consumer Commission is heating up, as the deadline for a new draft code looms.
The ACCC’s code pushes for Australian news organisations to be paid more by Google and Facebook when the tech giants use their content.
Consumer watchdog Chair Rod Sims argues news companies don’t have enough weight to currently negotiate fair payment.
“There is a fundamental bargaining power imbalance between news media businesses and the major digital platforms, partly because news businesses have no option but to deal with the platforms, and have had little ability to negotiate overpayment for their content or other issues,” he said.
The consultation period for the code closes on August 28, and in the last week Google has ramped up its criticism of the draft code.
The company – which has an estimated worth of over US$1 trillion (around A$1.38 trillion) – has been running banners on all of its search engine and on Youtube notifying users of the code’s potential negative effects.
In a statement linked to the banner, Google Australia’s Managing Director, Mel Silva, said the code would affect millions of Australians who currently use its many platforms.
“We deeply believe in the importance of news to society. We partner closely with Australian news media businesses — we already pay them millions of dollars and send them billions of free clicks every year,” she said.
“We’ve offered to pay more to license content. But rather than encouraging these types of partnerships, the law is set up to give big media companies special treatment and to encourage them to make enormous and unreasonable demands that would put our free services at risk,” she added.
Additionally, concerns have been raised by Federal Labor MP, Ed Husic, that the new code only benefits large news organisations, such as News Corp.
“I’m very concerned this is shaping up to be a News Corp bailout rather than a genuine attempt to level the playing field,” he told Sky News.
“News Corp has made a series of business decisions over the years that have turned out bad and now they’re trying in effect to get the ACCC and a compliant Coalition to act on their behalf,” he added.
Meanwhile, Google has also warned users that the code allows for their data to be handed over to news companies, who would then take control of the information.
“Under this law, Google has to tell news media businesses ‘how they can gain access’ to data about your use of our products. There’s no way of knowing if any data handed over would be protected, or how it might be used by news media businesses,” Mel added.
But, the ACCC has dismissed these two claims, stating the new code won’t bankrupt Google, nor allow for Australian’s data to be misused.
“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,” the ACCC said in a statement.
“Google will not be required to share any additional user data with Australian news businesses unless it chooses to do so,” it added.
The consumer watchdog is backed by the Australian Government, who first pushed for an inquiry into establishing a code of conduct for Facebook and Google.
“The government remains committed to introducing this significant reform with a world-leading mandatory code,” Treasurer Josh Frydenberg said.
Once the consultation period closes tomorrow, work will begin on reviewing the public notices about the code. The ACCC will also continue to work with Google on shaping the code.
Ultimately, the tech giant has the option of removing certain features for Australia users, such as the news function, as it did in Spain.
While the Federal Government may try and tax Google and Facebook further if it feels the two tech giants are complying with the code. Former ACCC Head, Alan Fells, said a tax could be the next step.
“Personally, I think that the government has got this huge stick in the closet if Google walks or partly walks, and that is to put on a digital tax,” Fels told The Conversation.
“A digital tax is being talked about globally, mainly at the OECD. And virtually every member of the OECD wants to put a digital tax on the platforms except the U.S.,” he added.