For the past year, the Australian government has been readying legislation that forces tech companies to pay local publishers for content that appears in Search and News. If the new law passes, Google today said it would have to pull Search from Australia.

Australia’s proposed “News Media Bargaining Code” would have Google pay local publishers to the possible tune of AU$600 million to $1 billion a year ($465 million to $775 million) when Search results include links and snippets to their news sites. Google News would also be affected by the law since aggregation is also the entire point of that app.

Besides payments, Google would have to give news media businesses a 14-day warning about changes to Search and YouTube algorithms. This “special treatment” would disadvantage all other site owners, and could delay updates.

In a public hearing today, managing director of Google Australia (and New Zealand) Mel Silva told senators that the search engine could not operate in the country under those proposed conditions. Google considers pulling out the “worst-case scenario and the last thing we want to have happen.”

The principle of unrestricted linking between websites is fundamental to Search. Coupled with the unmanageable financial and operational risk if this version of the Code were to become law it would give us no real choice but to stop making Google Search available in Australia.

As such, Google is asking for specific changes to the law, and “committed to achieving a workable News Media Bargaining Code.”

Withdrawing our services from Australia is the last thing that I or Google want to have happen – especially when there is another way forward.

We propose technical amendments in three areas to address the key problems we’ve outlined. These allow Google to pay publishers for value, without breaking Google Search. 

The company is not opposed to licensing, and already operates a News Showcase program internationally that pays publishers for content to appear in a special section of the Google News app.

Google also wants changes to an arbitration model that has “biased criteria” and “presents unmanageable financial and operational risk.” The company instead calls for “standard commercial arbitration based on comparable deals” that would allow for “good faith negotiations.” Lastly, Google is asking that it just be able to provide “reasonable notice about significant actionable changes to Google’s algorithm.”

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