Senate calls bluff and takes wind out of tech titans

Google has threatened to exit the Australian market entirely if the federal government’s mandatory media bargaining code becomes law. Picture: AFP

Google and Facebook huffed, and they puffed, but they didn’t come close to blowing the Senate down.

Now, the digital behemoths appear to be out of breath and out of ideas. 

Google continues to bellow its loose threat that it will exit the Australian market entirely if the federal government’s mandatory media bargaining code becomes law.

Really? Is there a company on the planet that would seriously walk away from an annual revenue stream of almost $5bn, just to avoid paying a fraction of that to media businesses whose content they have been cannibalising for years?

New players would be more than happy to fill the void and Google knows it.

With the rest of the world keenly watching how Australia handles the issue, independent senator Rex Patrick cleverly called Google’s bluff on its oft-­repeated threat to turn its lights out in Australia.

“You’re going to pull out of every market, are you? Or is this about stopping the (global) precedent?” he asked. 

Meanwhile, Facebook told the Senate hearing that its Australian news accounts for less than 5 per cent of an average user’s news feed. But still, Facebook doesn’t want to pay proportionate compensation to media companies for the reselling of their journalism on its platform.

It seems even a modest contribution to the sustainability of the Australian media industry would represent too heavy a financial burden for a company that boasts more than 15 million Australian users.

Senator Sarah Hanson-Young was right to observe that “some of these numbers don’t add up”.

Senator Andrew Bragg was also right when he accused Google of attempting to “blackmail” Australians with their cynical scare campaign to vacate the market if it doesn’t get its way.

And the Senate will surely be judged to be on the right side of history if it votes to pass the legislation in coming weeks.

The tech titans have already wrought untold damage on an industry that is the pillar of any democracy. The challenge is to stem the tide before it’s too late.