Google is testing Brinkmanship search in Australia
The Australian government is in the midst of a bold move to get tech companies to pay publishers for content shared on their platforms. This is one of the fundamental cases that the technology will face in the years to come. Large tech companies have benefited from relatively little regulation and oversight given the nature and size of their business. While many of these issues will take years to resolve, Alphabet Inc.’s Google (GOOGL) appears to be launching a collapsing search strategy to scare regulators and governments into backing down.
Key points to remember
- Google and Facebook, Inc. (FB) are expected to pay for news content shared on their monetized platforms under a proposed Australian law.
- Both companies have offered ways to avoid payments under the law, but Google’s solution is apparently to shut down search in Australia.
- Google’s reaction appears to be disproportionate and a bit of a PR mess by the tech giant.
Big Tech Dodge Platform
Google and Facebook have long argued that they shouldn’t be required to pay for the content they select from publishers. In the case of Facebook, this content is generally shared by users on the social media platform. Google uses algorithms to compile content for its services like Google News. Either way, companies collect ad revenue from traffic to their sites and, until some recent deals are signed, don’t share it with publishers.
Instead, Google and Facebook have long argued that publishers benefit from traffic when users click on content. Unfortunately, Google and Facebook have sometimes changed their platforms so that some or all of the content itself is fed into the app or the site’s platform for easy consumption without the user. does leave, thus removing much of the benefits of the traffic argument. of the arrangement. As publishers’ wrath caught the attention of lawmakers, Google and Facebook began signaling their willingness to pay for the content they repost, with Facebook saying in 2019 that it would start licensing agency content. Press. Google took a similar step in February 2020.??
The progress of the two initiatives is unclear. Australian lawmakers were tired of waiting and took their own steps, proposing a law that will essentially force Facebook and Google to pay for the content they monetize for their own sites. European countries, including France, have already tried this with very little evidence of their efforts, but the Australian push appears to have a lot of political will behind it.??
Brinkmanship’s response to regulation
The most interesting thing about the Australian proposal, aside from the potential precedents, is the different reaction of the two internet giants. Facebook and Google have adopted a similar tact in their opening maneuvers, but the scale is quite different. Facebook said it could end up modifying the platform to prevent Australian users from sharing news links. While this dodges the central question of whether Facebook should pay content creators, it’s a relatively docile way for the company to part ways with the problem. Facebook’s position is that it wants to work with publishers to reach a deal, but the law as proposed gives publishers too much bargaining power.
Google, however, has apparently taken a much more aggressive negotiating stance. According to the Wall Street Journal, the chief executive of Google in Australia told lawmakers that having to pay publishers for links that appear in search would force the company to shut down Google search for Australian users. This has clearly rubbed lawmakers the wrong way, as Prime Minister Scott Morrison said: “Australia sets our rules for the things you can do in Australia. People who want to work with this in Australia, you are welcome. But we don’t respond to threats. “??
A miscalculation by smart people
This suggests that Google miscalculated, maybe wrong. It’s astonishing that a company that once worked to change its search algorithm to comply with Chinese censorshipwould be unable to find a technical solution allowing it to operate its basic search function in Australia. For example, the company could operate non-monetized search services in Australia or adjust search and news features so that only one clickable headline appears. These are just two alternative proposals the company could have answered, and it is hoped that the smart folks at Google will be able to come up with much better ones.
The bottom line
The idea of stopping research in Australia seems more of a threat than a realistic technical problem. It also puts Google in a sticky situation where it will have to backtrack significantly to find that magical area of compromise where Australian publishers get a little of what they want and Google can continue to profit from it as well. This type of scam from Google frankly seems irrelevant and may well damage its credibility in future cases. At a time when big tech companies face serious social licensing issues, Google needs to think as much about the public relations aspect of its business as it does the innovation aspect.