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Google is in a fight with Australia over paying fees to publishers. Will Bing step in to fill the void?

Time to use Bing? Why is Google being kicked out of Australia?

Google is being kicked out of Australia & Bing is maneuvering to take its place.

The News Media Bargaining Code, making Google & Facebook legally obligated to pay news publishers to display their content, resulted in Google Australia’s Managing Director, Mel Silva, threatening to pull services from the country in a Senate hearing on January 22. Facebook made a similar threat, stating that there was no commercial benefit to surfacing news content on their feeds.

Australia’s minister of communications, Paul Fletcher, commented on Google & Facebook’s remarks about withdrawing services, “We made it clear we very much prefer them to stay in Australia, they’re an important, significant part of the ecosystem, but ultimately these are business decisions.”

 

The government has said it wants “fair” payments to news organizations, which have seen print advertising revenue fall by three-quarters over the past 15 years. In contrast, digital advertising on major platforms like Google & Facebook has risen dramatically over the same time.

Exactly how much money is at issue is undecided. The proposed law involves bargaining & arbitration, leaving the matter open – if Google can’t reach agreement with a news outlet, a judge would decide what is “fair”.

Ring-a-ding Bing

In the meantime, Microsoft’s Bing has thrown their hat into the ring. With a mere search engine market share of 3.62% in Australia, compared to Google’s 94.45%, Bing has taken this opportunity to divulge their interest in further developing their presence in the country.

Paul Fletcher discussed a recent meeting with Bing, “The Microsoft CEO reached out to the prime minister and proposed a meeting, accompanied by senior executives, I was able to join that meeting, and we had a very informative discussion about Microsoft’s interest in the Australian market,” he stated.

Google has about 90-95% of the search engine market share in Australia – similar to the rest of the world. But other options for search exist – mainly Microsoft’s Bing, & Yahoo, but also privacy-focused ones like DuckDuckGo. However, site analysis firm Alexa ranks Google as the most-visited site on the internet, Yahoo lies at eleventh, and Bing at a distant thirty-third.

International implications

Yet, Google and other companies affected – like Facebook – are based in the U.S. And the U.S. government – at least the previous administration – has urged Australia not to “rush” the new law, warning that it is “extraordinary” and may have “long-lasting negative consequences”.

A controversial new EU rule on copyright says that search engines and news aggregators should pay news sites for links. In France, publishers this week agreed in a deal with Google on how that should work. But only a handful of such deals have been signed, with notable French newspapers – making it a very different thing than the wide-ranging, much stricter Australian plans.

While there is no exact match for this scenario, Google has left a country before due to local laws. Google has been largely unavailable in mainland China since a 2010 dispute over alleged Chinese hacking, during which it stopped censoring search results for Chinese users.

Smaller market, significant money

Compared to China, Australia is a much smaller potential market. Google Australia made $3.6 billion in revenue in 2019. Advertising revenue made up most of that, at $3.27 billion. But factor in all the expenses, and Google Australia made $101.82 million in profit for the year. To put that in context, Google’s parent Alphabet has an estimated $100 billion or more of cash on hand to cover any revenue gaps.

However, it’s about more than money. The bigger concern is whether Google wants a modern Western democracy to showcase how using its competitors can work just fine.

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