Google's opening statement to Australia's Senate inquiry

22 January 2021
Mel Silva

Today Google Australia’s managing director, Mel Silva, appeared at a public hearing of the Senate Economics Legislation Committee that is reviewing a proposed new law, the News Media Bargaining Code. 

Opening statement by Mel Silvato the Senate Economics Committee Inquiry:

Thank you, Senators, for your time.

I am Mel Silva, Managing Director of Google Australia and New Zealand. I’m joined by Lucinda Longcroft, the Head of Government Affairs and Public Policy for Australia and New Zealand.

Senators, I would like to start by saying that Google is committed to achieving a workable News Media Bargaining Code.

In its current form, the Code remains unworkable and if it became law would hurt not just Google, but small publishers, small businesses, and the millions of Australians that use our services every day.

There is a way forward that allows Google to pay publishers for value, without breaking Google Search and our business in Australia.

There are three areas of concern which I will touch on shortly, but the most critical of these is the requirement to pay for links and snippets in Search. This provision in the Code would set an untenable precedent for our business, and the digital economy. It’s not compatible with how search engines work, or how the internet works, and this is not just Google’s view - it has been cited in many of the submissions received by this Inquiry.

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.

That would be a bad outcome not just for us, but for the Australian people, media diversity and small businesses who use Google Search.

Google is known for answering queries and helping people find what they are looking for on the web, one of the misconceptions at the heart of this debate is that our users only come to Google because they can find news, or that news is a disproportionate driver of our popularity.

News and Journalism are a critical part of any democracy and we don’t disagree with that view. But in the context of Search - the ability to show results from a diverse range of news sources is equally as important as the ability to show results to a diverse range of childcare centers in your suburb.

Each year we help more than 19 million Australians find information online. The fact that we offer a useful search engine provides the platform for 1.3 million businesses, large and small, in Australia to be discovered by users here and around the world The fact that you can Search for everything from recipes, the weather, or news, means you also search for your local cafe, or great plumber near me

Relevant results for all kinds of queries is what brings users to our Search Engine and this is what enables those 1.3 million Aussie businesses to get discovered and also creates hundreds of millions of connections with their potential customers.

This has benefits for the entire Australian economy - and something that has been incredibly important for businesses as they navigate COVID and find new ways to connect with customers in the digital world.

This lies at the heart of our concerns with a Code that would require payments simply for links and snippets just to news results in Search.

The free service we offer Australian users, and our business model has been built on the ability to link freely between websites - this is a key building block of the internet.

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.

First, rather than payment for links and snippets, the Code could designate News Showcase, and allow Google to reach commercial agreements to pay Australian news publishers for value in addition to the valuable traffic we already provide through Search.

News Showcase launched in 2020, and has global budget of $1.3 billion over three years, it pays news publishers for their editorial judgment in curating panels of news that appear daily on Google services, and it pays to grant users access to selected stories behind-the-paywall - not for links in Search. News Showcase enables Google to pay a diverse range of news publishers, including smaller and regional publishers.

We have already reached News Showcase agreements with 450 publications globally, including 7 publishers in Australia.

Secondly, the Code’s final offer arbitration model, with biased criteria presents unmanageable financial and operational risk for Google. If this is replaced with standard commercial arbitration based on comparable deals, this would incentivise good faith negotiations and ensure we’re held accountable by robust dispute resolution.

Finally, the algorithm notification provision could be adjusted to require only reasonable notice about significant actionable changes to Google’s algorithm, to make sure publishers are able to respond to changes that affect them.

In closing, Senators, there is a clear pathway to a fair and workable Code. With only slight amendments, the Code can support Australia as a world-leader in news innovation, media diversity, and consumer choice without sacrificing the benefits that Google provides to large and small businesses in Australia.

We look forward to responding to your questions. Thank you.

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