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Demystifying Google's Open Letter

01st May 2020

As you may already be aware, Google has attacked a new Australian law forcing tech giants to pay local news outlets saying it could threaten Australian search services. In an open letter, the firm warned that its YouTube and Search features could be "dramatically worse" if new rules were brought in. It also added that users' data could be shared. At King IT we have followed this closely and sought to form an opinion on this.


Google has said it will fight the regulation which the government says is designed to create "a level playing field" for news outlets. Google in its open letter has stated that “The way Aussies search every day on Google is at risk from new regulation.” “You've always relied on Google Search and YouTube to show you what's most relevant and helpful to you. We could no longer guarantee that under this law.”. Google Search and YouTube services would be “dramatically worse” and the new regulation “could lead to your data being handed over to big news businesses”, Ms Silva said.


So, what has been proposed? Last month, the Australian Competition and Consumer Commission created draft legislation that asks tech companies such as Facebook and Google to pay for content. It would allow news and media companies to negotiate as a group with tech giants for the content that appears in their news feeds and search results. The draft code covers other matters too, including notifying news companies of changes to algorithms. Penalties could be up to $10 million per breach or 10% of the company's local turnover.


The aim of the legislation is for tech giants to pay for 'high quality' news, and help support the ailing media sector as Murdoch has shut 112 print papers in Australia.


The competition regulator said Google's open letter “contains misinformation” about the proposed law. Rod Sims the ACCC chairman said in a statement, the new regulations would "address a significant bargaining power imbalance" between Australian news media and large tech companies.


So what’s our verdict? The recent notification and copy of the letter available when you conduct a google search has caused some to panic that previously free content is going to become paid. The reality is that Google will not be required to charge Australians for the use of its free services such as Google Search and YouTube unless it chooses to do so. Australia is a large and profitable market for both Facebook, Google, and many other tech companies and other free alternatives to Google search and YouTube will always exist such as Bing and Vimeo. They will no doubt be watching this with great interest, hoping to unseat Google's top spot. Google’s open letter talks about “big media companies” but the reality is that local media needs support. Having our local companies and journalists produce the content, and then have US-owned tech giants be the primary recipient of the ad revenue seems a bit unfair to local companies. Ultimately should you be worried about Google's free services becoming paid? No, we don’t think so.  


If you are worried about privacy online we offer full audits to ensure that Google and other tech companies including media companies under the proposed legislation find it harder to track and learn about you. Feel free to come in-store and ask questions about this, and how it could impact you.