Australia vs Google and Facebook: we’re not alone

Australia is not the only country that doesn’t “like” Facebook’s strategies for dealing with opponents. Picture: AFP

Canberra’s battle with Google and Facebook is mirrored by the tech giants dealings with regulators and governments around the world.

On Tuesday Facebook threatened to stop using Australian and international news on its platforms in Australia if world-first regulation passes to set up a bargaining code that could mean tech giants paying media companies for news.

Facebook’s threats followed similar claims from Google last month, with the reactions and remedies virtually the same.

They also mirror tactics by Google in reaction to lawsuits in Arizona and elsewhere over the way it uses location data to boost its digital advertising business.

Hitting back at Facebook, Treasurer Josh Frydenberg said: “We don’t respond to coercion or heavy-handed threats wherever they come from.”

Australian Competition and Consumer Commission boss Rod Sims described Facebook’s threat as “ill-timed and misconceived”.

Australia’s experience looks set to be the same as other countries that have tangled with the tech giants, either when trying to get them to negotiate over paying for news content, or over alleged abuses of location data.

The reason may be because the titans fear that whatever happens in Australia could open the way for similar enforcement action elsewhere.

Clifford Chance partner Dave Poddar said “The massive over-reaction by Facebook to suggest a withdrawal of services to Australians suggests that Google and Facebook may be concerned that the government‘s proposed legislation creates a workable model that establishes a road map for other jurisdictions to pay publishers (and therefore journalists) for news content.”

In Australia, the proposed media code is to be compulsory because of the failure of the platforms and media companies to agree on how compensation for content would be paid.

Talks got nowhere in France either. The boss of Paris-based newspaper Le Figaro, Marc Feuillee, complains Google has not negotiated in good faith with publishers to pay for the listing of their content.

Arizona also complained about being stonewalled after a lawsuit accusing Google of illegally tracking users’ locations. The ACCC has a similar case against Google over the use of location data and alleged misleading statements on its use.

Arizona’s state attorney (AGO) said: “Google has impeded the AGO’s investigation for months on end.

“Google was uncooperative with the AGO’s investigation … and failed to substantively respond to any of the AGO’s demands for information,” it added.

Google’s claims on its control on software and mobile devices were “inaccurate and misleading” and “Google refused to do any kind of meaningful search or production”, the state attorney said.

The comments from Arizona and France give some guide to the nature of the battle facing the government and the ACCC in imposing a bargaining code on the platforms.

Which is more powerful - the federal government or Google and Facebook?

Well, here are some figures: the market value of all listed companies on the ASX is $2 trillion, Australia’s GDP is $2 trillion (year by year change), Google’s market value is $1.5 trillion and Facebook’s is $1.2 trillion.