Google this: small business resents giant’s bully-boy tactics

Google might well see its search service as indispensable in Australia but that assumes that no business is capable of filling the void. Picture: AFP

Google’s extraordinary threat to shut down its search services across Australia, an effective monopoly, came out of the blue. “It is not a threat. It is a reality,” Google Australia chief executive Mel Silva said. Her bombshell is intended to pressure the government to cave in and abandon plans for a new media bargaining code.

What is almost more surprising, however, is the steely response from those whom Google is targeting. It is small businessmen and women, the engine room of the economy, who may cause the tech giant to regret its latest move. They appear in large part, to be right behind Scott Morrison.

“We don’t respond to threats,” he said.

Spare a thought for the average hair salon, still wrestling with dying and drying hair on heads in masks. With 94 per cent of the search engine capacity in Australia, the withdrawal of Google search services would probably hit most of them, cutting them off from their customers. And yet responses from salon owners and franchisees in a survey by the Australian Hair Dressing Council were largely defiant.

“To be honest, Google has the monopoly but if Google left, another search engine would step up,” says one.

“I think they should be regulated and made to pay Australian tax on purchases within Australia.”

“It would be a huge inconvenience,” agrees another, “but we would survive. I think they should be regulated.”

And a third: “It will just make another search engine prosper. I don’t trust Google at any rate so it will be very positive to see a changing of the guard.”

Google Australia’s Mel Silva.

Google’s threat raises two important questions. In pandemic times when we are all thinking about security of supply chains and vulnerabilities, how on earth have we allowed one company to dominate such a critical part of doing business? And has Google just overplayed its hand by demonstrating precisely why Australia needs two and preferably three competitive search engine businesses?

Bumpy though the transition to other services might be, the outrage from small business is not just about leaving them in the lurch — it is because for years now, small businesses across the country have invested many thousands of dollars in Google Search to reach their customers. They see a shutdown as an egregious breach of the trust they placed in Google by investing precious dollars and management time in its service, all of which would, overnight, be worth nothing.

And this is hardly the first breach of trust by tech giants.

Those outside business would know little about the investment that aspiring companies make in search engine optimisation, almost all of it with Google. “We spend about $1000 a month to be part of the SEO” explains Sandy Chong, who owns Suki Hairdressing in Newcastle, “but it takes a while to build up your portfolio and a lot of time, money and investment to make sure your business is seen first. All of that would get thrown out of the window.”

Chong also runs the Australian Hairdressing Council and a business that headhunts in the sector. Each pays about $1000 a month to Google but to escalate their presence on Google, on Facebook ads and in social media, Chong is looking at using an SOE agency that is quoting $110,000 a year. “A small business, $1000 a month is a lot,” she adds, “but when it creeps up to $5000, all that money you’ve invested is lost.”

Google is not an evil empire, but it is showing all the signs of anything that is too big” says small business champion Peter Strong.

Learning the dark art of clawing your way on to Google’s front page seems to be a constant work in progress, keeping to Google rules of play as monitored by ­Google bots. “Someone in small business, we would be quite ignorant of how it all works” says Chong. “You have to come up with all the right key words that are necessary for a hair salon – ‘blonde’, ‘curly hair’, ‘brunette hair’, ‘blunt cut’. You even try to come up with the competition’s words as well, to try to make sure you are first in front of everybody else. No key words and you will have no presence. It’s a very strategic part of marketing.”

“Google is not an evil empire, but it is showing all the signs of anything that is too big” observes small business champion Peter Strong at COSBOA. “It is domin­ating. It can make its own rules, which it does, and now it doesn’t like the fact that someone else is making the rules up for it. For some businesses, without a doubt this is terrifying. And the lesson for the business community is we have got to have more than just one place to go on the internet.”

Google might well see its search service as indispensable in Australia but that assumes that no business is capable of filling the void. Bing with 3.7 per cent market share may be the underdog but it has the might of Microsoft behind it. Indeed, from the accounts of the Prime Minister’s recent chat with chief executive Satya Nadella, Microsoft would appear ready to exploit the situation if Google withdrew.

Other search services like DuckDuckGo and Yahoo! sit at just above 0.7 per cent, according to web analytics firm Statcounter.

Chief regulator Rod Sims at the ACCC says without Google Search, media companies could negotiate deals with smaller search engines more easily and healthy competition would deliver a far better market for consumers.

Back on the floor of hair salons, there are some who genuinely fear a shutdown of Google Search.

“As a haircolour expert, Google is a search engine for my website, industry education services, and so much more in my business,” says one respondent to the salon survey.

“I rely on Google for new clients to search and find me, and for my existing clientele to easily search for my opening hours and directions to find the salon.”

Yet the uncomfortable message for Google, summed up by another hair dresser, is that what it is doing is socially unacceptable and socially irresponsible, and will do little to helps its cause.

“Having read reports on this, I feel like small business and most businesses who pay the Google fees and create their revenue are the clients who will be affected and it is a huge global tech company playing bully tactics.

“It does not make me sympathetic to their grievances with this kind of behaviour. If they raise revenue from business in Aus­tralia, how can they justify taking content for free?”

In last week’s meeting between Josh Frydenberg and Facebook chief Mark Zuckerberg, both stood firm.

Google’s threat remains active. It is unclear where this brinkmanship will lead but it would be unwise to underestimate the resolve of the government.

Once again, Australia is pioneering controversial territory. After banning Huawei and leading the calls for an inquiry into the origins of COVID-19, both upsetting China, Australia is leading the push to regulate the tech giants in America.

The prospect of a new precedent for the world on tech regulation ups the stakes. The world is indeed watching.

“It’s up to the competitors of Google Search now to make themselves worthwhile,” says Peter Strong. “A message, big time, to the business community is that we have got more than one choice. Heaven help us, what is more vital in the modern word than a search engine?”