Google goes to war over ad revenue

Denham Sadler
Senior Reporter

Google has gone on the offensive against the Australian government’s plans to force it to enter into revenue-sharing agreements with media companies, issuing a series of threats over the impact of the plan as part of a new effort to sway public opinion against the proposal.

In an open letter to Australians, Google said the draft laws would lead to a “dramatically worse Google Search and YouTube”, lead to user data being handed over to big media companies, and put free services at risk.

The Australian Competition and Consumer Commission (ACCC) last month unveiled a draft code of conduct governing bargaining between Google and Facebook and large media companies. Once the final code is agreed upon, it will be enshrined in legislation.

Google search
Push back: Google says search quality is at risk

Under the draft proposal, Google would be pushed into forced arbitration if it failed to reach a revenue-sharing agreement with an eligible media company in three months. An independent arbitrator would then pick between the two parties’ final offers within 45 days.

The draft laws would also require Google to provide news companies with advanced notice of any relevant algorithm changes and information on the data it collects on users and what is available to the companies.

Google is less than enthused with the proposal, with its local boss Mel Silva issuing an open letter filled with thinly veiled threats, pop-ups targeting any Australians conducting a Google search and a series of further campaigns in the works.

On Monday, Google’s search homepage in Australia featured a warning symbol with the message, “the way Aussies search every day on Google is at risk from new government regulation”, with a link to the open letter.

The tech giant is attempting to position the proposed new law as favouring the large media companies over smaller content creators such as YouTubers and as putting sensitive user data at risk.

In the letter, Ms Silva claims the plan would “force” Google to provide Australians with a “dramatically worse Google Search and YouTube”.

“You’ve always relied on Google Search and YouTube to show you what’s relevant and helpful to you. We could no longer guarantee that under this law,” Ms Silva said in the open letter.

“The law would force us to give you an unfair advantage to one group of businesses – news media businesses – over everyone else who has a website, YouTube channel or small businesses,” she said.

“News media businesses alone would be given information that would help them artificially inflate their ranking over everyone else, even when someone else provides a better result.”

Ms Silva said the proposed law would force Google to tell media companies “how they can gain access” to data about users, warning that “there’s no way of knowing if any data handed over would be protected, or how it might be used by news media businesses”.

But the ACCC has said that these provisions do not relate to any user data, and instead are aimed at making Google tell media companies what data is currently available to them in a “readily comprehensible” way.

The proposal would also make Google provide more information on what data it collects on users and how they interact with news content on the platform, and how that data is used.

Google’s claim to want to protect user data also comes just after the ACCC launched legal proceedings against the company for its data collection practices for a second time.

Last month, the ACCC launched the court proceedings over Google’s expanded collection and use of personal information for targeted advertising after it allegedly linked users’ account information with their activity on other websites.

In the lawsuit, the competition watchdog alleged that Google misled its users over this and did not properly obtain their consent.

Ms Silva also warned that the changes put Google’s free services at risk.

“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 said.

“We’re going to do everything we possibly can to get this proposal changed so we can protect how Search and YouTube work for you in Australia and continue to build constructive partnerships with news media businesses – not choose one over the other.”

In a separate open letter to “Australian creators and artists”, Google also warned that the new laws would have a “significant negative impact on the creator ecosystem in Australia”, saying they would give “unfair advantages” to large news businesses over vloggers and musicians.

“It will create an uneven playing field when it comes to who makes money on YouTube. Through this law, big news businesses can demand large amounts of money above and beyond what they earn on the platform, leaving fewer funds to invest in you, our creators and the programmes to help you develop your audience in Australia and around the globe,” it said.

“The imbalances created by this proposed law could potentially affect all types of Australian creators, far beyond those who focus on news: from vloggers, to educational creators, to music artists and beyond.”

Do you know more? Contact James Riley via Email.

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