A Google executive said on Friday that a proposed Australian law to make digital platforms pay for news was unworkable and its proposed arbitration model was biased toward media businesses.
Google Australia and New Zealand Managing Director Mel Silva made her first public comments on the details of the
proposed legislation since it was introduced to Parliament last week.
The so-called News Media and Digital Platforms Mandatory Bargaining Code would force Google and Facebook to compensate Australian news media for the journalism that they link to.
“It forces Google to pay to show links in an unprecedented intervention that would fundamentally break how search engines work,” Ms Silva said in a statement.
If a platform and a news business couldn’t agree on a price for news after three months of negotiations, a three-member arbitration panel would be appointed to make a binding decision for payment.
Silva said “binding arbitration within the code could be a reasonable backstop — so long as the arbitration model is fair.”
However, the proposed arbitration model was “skewed to the interests of one type of business only,” Ms Silva said, referring to the media.
Google said it had provided a better model with Google News Showcase. The tech giant is paying participating publishers to provide paywalled content to News Showcase users through the model that it launched in October.
“By imposing final-offer arbitration with biased criteria, it encourages publishers to go to arbitration rather than reaching an agreement,” Silva said of the government’s model.
Meanwhile, A coalition of ten US states led by Texas have filed an antitrust lawsuit against Alphabet’s Google, accusing the tech giant of abusing its monopolistic power and colluding with Facebook to rig advertising auctions.
In their lawsuit, filed at the US District Court in Texas, the states claim that Google struck an “unlawful agreement” with Facebook as soon as the company realized in 2017 that Mark Zuckerberg’s social network could be a powerful rival in online advertising.
According to the complaint, the deal – codenamed after a ‘Star Wars’ character (it is not clear which one, as the name itself was redacted in the text) – was meant to kill the competition.
In exchange for Facebook’s backing down from header bidding, Google allegedly gave the tech rival information and speed – among other advantages – in the ads auctions that Google runs for publishers’ mobile app advertising inventory each month in the US.
“Google is a trillion-dollar monopoly brazenly abusing its monopolistic power, going so far as to induce senior Facebook executives to agree to a contractual scheme that undermines the heart of the competitive process,” Texas Attorney General Ken Paxton said as he introduced the lawsuit.
He added that the Silicon Valley tech behemoth is destroying the free market as it is “essentially trading on ‘insider information’ by acting as the pitcher, catcher, batter and umpire, all at the same time.”
The ten states demand a jury trial and want the court to force Google to pay multiple fines if found guilty.