Google Threatens to Pull Out of Australia Amid Proposal to Require Tech Companies to Pay Media for News Content


Jan 22, 2021


Image Credit: Wikipedia

In April 2020, Australian lawmakers introduced legislation that would force tech giants such as Google to pay for news content and negotiate a compensation structure with any news media outlets it hosts. In response, Google is now threatening to withdraw its services from the country. Facebook is another tech company fighting the proposed legislation and has threatened to remove news content from Australian Facebook users’ feeds if the proposal becomes law.

Google’s managing director for Australia, Mel Silva, told the Australian Senate such legislation would set a “dangerous precedent. … The principle of unrestricted linking between websites is fundamental to search.” Imposing payment for news links, she said, would cause “unmanageable financial and operational risk” to the company, The Guardian reports.

The pushback from Google and Facebook has not caused lawmakers to waver so far. Some called the companies’ threats “blackmail” and “big corporations bullying democracy.” The Australian Prime Minister, Scott Morrison, has said the country’s parliament will not be scared by the tech giants’ threats, adding, “Let me be clear: Australia makes our rules for things you can do in Australia,” the BBC reports.

The rationale behind Australia’s code, or proposed legislation, lies in how companies such as Google and Facebook are benefiting from people who want to read the news; therefore, it’s only fair they pay news outlets for the journalism hosted on the tech platforms. Lawmakers said they are concerned by the death of journalism and the rise of ‘content,’ a shift tech companies have facilitated with their likes, comments, and views as markers of success and revenue for media publications. In order to preserve the sanctity of news, “fair” compensation is essential both to journalism and to democracy, lawmakers said.

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In retaliation, Google has attempted to school the lawmakers, with Silva saying that interrupting the ‘free’ flow of information online is not “how the internet works,” and that forcing tech companies to pay for content they host is “an untenable precedent for our business and the digital economy.” Not buying the argument, Australian Senator Rex Patrick said, “It’s about breaking your bank account, that’s what this is about. It does not touch the internet and the way in which it works.” Guardian Australia’s managing director adds, “Opponents of the code are defending an open internet that ceased to exist years ago and instead has become dominated by a small number of very, very large U.S. tech companies,” he said. “In fact, Google and Facebook are the internet for most Australians. … Where people go online is largely determined by these two companies’ algorithms.”

Both Google and Facebook, however, are fighting to keep the code from being imposed on their operations. They say they’re amendable to change, but ask the code not be made law until they have had time to negotiate their own deals with media outlets.

What comes of this fight, as Google’s Silva rightly predicts, has the power to change the future of news around the world and possibly revive a dying industry. The current battle also marks one of the strongest challenges to tech giants’ hegemony on the Internet — a phenomenon we now realize may be more trouble than it’s worth


Written By Rajvi Desai

Rajvi Desai is The Swaddle’s Culture Editor. After graduating from NYU as a Journalism and Politics major, she covered breaking news and politics in New York City, and dabbled in design and entertainment journalism. Back in the homeland, she’s interested in tackling beauty, sports, politics and human rights in her gender-focused writing, while also co-managing The Swaddle Team’s podcast, Respectfully Disagree.


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