Google has taken the extraordinary step of encouraging its users to fight back against proposed Australian government legislation that aims to level the playing field between news media companies and digital platforms. Why has it picked this fight? And will it be successful?
Why am I seeing these Google warnings when I open Chrome or Google search?
The Australian government wants Google to pay Australian media companies for news appearing on Google and is planning to pass a law to make it happen.
In response, when people open up Google Search in Australia now, they are greeted below the search bar with a yellow hazard warning that states “the way Aussies search every day on Google is at risk from new government regulation”.
This week, Google began alerting people via their platforms and on social media to an “Open Letter to Australians” that makes a number of claims about the proposed code for digital platforms, arguing, among other things, that free services could be at risk due to the regulation, and that YouTube content creators could earn less because news media would be advantaged.
YouTube, however, is currently excluded from the code, so it would not apply to that content.
The Australian Competition and Consumer Commission’s draft news media code for digital platforms would cover, at least initially, just Google and Facebook.
What is the code?
The proposed code would require Google and Facebook to negotiate in good faith to pay Australian news media companies (except public broadcasters) for the use of their content.
News companies and the platforms have three months to negotiate, and if an agreement cannot be reached in that time, then they go to arbitration, where selected arbitrators or a panel appointed by the government will make a final decision on payments.
The code would require Google and Facebook to give news media companies at least 28 days notice of algorithm changes affecting news ranking – the display of news content and advertising with news content.
Google and Facebook would also be required to tell media companies what data it collects on users engaging with news content, and how the companies could access that to give them a better understanding of the audience.
The code would prohibit platforms from discriminating against Australian media outlets covered by the code.
If Google and Facebook don’t comply, the ACCC would be able to issue infringement notices for minor code breaches, but for larger breaches, there are fines of up to $10m per breach, three times the benefit obtained, or 10% of annual turnover, whichever is greater.
Why is the Australian government doing this?
The plan initially was for a voluntary code between the platforms and news media companies, but with the Covid-19 pandemic accelerating the downturn in advertising and revenue for news businesses, and given negotiations on payments had stalled, the Australian treasurer, Josh Frydenberg, opted for the development of a mandatory code to make it fairer for news media companies, and ensure their viability.
Are the claims made by Google correct?
Google makes a number of claims in the open letter that the ACCC has rejected in response.
1. Google claims the law would “give big media companies special treatment and encourage them to make enormous and unreasonable demands that would put our free services at risk”.
The ACCC has not set an amount Google must pay to media companies. It all must be done through negotiations.
Media companies can make demands in negotiations with Google, but Google does not have to accept them.
The arbitrators (which can be appointed by Google and the media companies), if negotiations fail, would make a final determination based on each side’s submissions.
There’s no evidence that “enormous and unreasonable demands” would be accepted, and the code specifies that the negotiations must consider whether the payment amount would place an “undue burden” on Google or Facebook.
The code does not determine what value digital platforms offer to news companies as part of the negotiations, which is one point Google has repeated on how many clicks it delivers to news sites in Australia.
Google has pointed to the fact it is already paying companies some money, and has offered to pay more to license content. The code would mean if negotiations fail, the final amount is not determined by Google.
The ACCC also said there is nothing in the code that would force Google to charge for YouTube or other services “unless it chooses to do so”.
2. Google claims news companies would have an “unfair advantage” over how their content appears in search results compared to others. While the code would require Google to give advanced notice about algorithm changes to news companies, the news companies would not know how the algorithm worked exactly, and there is nothing in the code preventing Google from providing that information to others at the same time.
Google argues giving anyone information to “artificially inflate their ranking” in search results would make the overall service worse.
3. Google claims “search data is at risk” because news companies would be able to find out what Google collects on users engaging with news content, and how it can access that.
Google argues it has no way of knowing if the data handed over to news businesses would be secured, nor how it would be used.
The ACCC has said “Google will not be required to share any additional user data with Australian news businesses unless it chooses to do so” and in the Q&A for the code has said any additional data provided to news businesses would need to be in compliance with Australian privacy law.
Why has Google come out so strongly against it?
The code would be setting a global precedent when it comes to paying news media companies for content.
By prompting its users to make submissions opposing the changes, the tech giant appears to be trying to force the government to water down the plans.
Google has argued that the revenue it makes from advertising in news search results is about $10m a year, a fraction of the $600m the Nine Entertainment chairman, Peter Costello, has proposed Google would be required to pay to the industry.
Google has indicated it would prefer not to have its hand forced, and instead voluntarily negotiate agreements with publishers for licensing content.
Google has previously tapped into its users, on YouTube in particular, to oppose the EU’s Article 13 legislation on copyright, alerting them to what the ramifications might be. The EU passed the legislation in 2019.
Will Google’s campaign against the code work?
It is too soon to say whether it will have an impact. For users of Google Search or Chrome, it is the first thing they see when opening up the sites or browsers in Australia, but data from social media tracking company CrowdTangle suggests the links are getting very little traction on Twitter and Facebook. The link has had around 2,800 interactions on Twitter and more than 15,000 on Facebook.
Google had been paying Twitter to promote the tweet linking to the open letter into people’s feeds.
The ACCC is so far not saying how many submissions it has received as a result of the campaign, but it is expected those from members of the public will be published, alongside all the others, after the submissions period ends on 28 August.