Google has Warned to pull out its search engine from Australia

Google, it seems is all set to retract its search engine from Australia. The tech mogul is determined to withdrawing its search engine and has no desire to yield to Australia’s new law.  The situation is escalating as days pass since both parties, lawmakers and Google, are refusing to make concessions. Google has even started releasing ads on its site to warn users of the consequences of the law and has stopped showing news sites to see their “relevance”.

What does this new law propose?

Australia’s new law proposes that tech companies such as Google and Facebook should pay media outlets for their news content. The tech giants would have to share royalties with news publishers.

Australia’s Competition and Consumer Commission (ACCC) claims that this new law will address, “a significant bargaining power imbalance between Australian news media businesses and Google and Facebook.” ACC has also suggested that this should not affect Google search business since Google does not have to charge users if it does not want you. It is quite obvious that Google disagrees.

The Australian Government’s Perspective

The Australian government is adamant about its decision and is showing no signs to back out. After Google announced that it would no longer provide its services in Australia, the Australian PM Scott Morrison responded by saying that the government will not yield to “threats”. Furthermore, the PM is backed up by broad political support hence the government is planning on going ahead with the law regardless of Google’s threats.

Mr. Morrison said in a statement on Friday, "Let me be clear: Australia makes our rules for things you can do in Australia. That's done in our parliament," "And people who want to work with that, you're very welcome. But we don't respond to threats."Other lawmakers on Friday described Google's ultimatum as "blackmail" and "big corporations bullying democracy".

The government’s determination stems from the following reasons. Google Search is the dominant search engine in Australia with minimal market competition. The tech platform users are mainly people who want to read the news hence the newsrooms should be compensated and paid a fair amount for their services.

It has been argued that financial support is needed for the news industry to prosper since media is one of the vital pillars of democracy. It has been reported that since 2005, there has been a 75% decline in advertising revenue in Australian print media. Google’s threat is severe and the banter is being closely monitored across the world. The US trade representative even advised Australia to discard the law.

Google’s Rebuttal                                                                                                                         

The company has been voicing its disapproval of the law for several months. Google claims that, it “would set an untenable precedent for our business and the digital economy” and that it’s “not compatible with how search engines work.” The tech giant is not alone but has credible allies. Sir Tim Berner-Lee, the creator of the World Wide Web, agrees with Google’s assessment and adds that this would be a primary breach of the web by requiring payment for certain content. He is not alone, Vint Cerf, who aided in designing TCP/IP, is another supporter.

Google Australia managing director Mel Silva said in a senate hearing on Friday that the law was “unworkable”. She argued that there will be, "an untenable precedent for our businesses and the digital economy" if the company had to pay for link and search results. This was not compatible with the free-flowing data share of information online or "how the internet works"

Moreover, Google along with Facebook argue that newsrooms already benefit from their services since they drive the readers towards their websites. It is also worth noting that Google dominates the search engine market with a nearly 90% market share. While all its revenue is from ads.

Google’s threat means the company has genuine concerns over the law since it would be pulling from an entire country’s market. Politicians are aware that the pandemic has been extremely profitable for Google which doesn’t help its cause. However, Google has offered to help fund local journalism which could be a starting point for a compromise.

What could this mean?

It looks like Australia is determined for this law to pass while Google wants nothing to do with it. The entire world is eagerly watching for the outcome. If the law has been passed other countries could follow suit which could result in the business model for these companies being completely altered.

Google’s threats seem to indicate that the tech mogul is seriously concerned about the future of its services. It would not take such drastic measures and withdraw from an entire country if it could benefit. The Australian government and Google could agree since Google did say it would help aid in funding local journalism.