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Google threatened to shut down its search service in Australia if the government passes legislation that forces Google and Facebook to pay publishers Down Under for reusing their news content.

The News Media Bargaining Code, proposed by the Australian Competition and Consumer Commission last year, would give publishers the rights to bargain individually or collectively with Google and Facebook over how much they should be compensated whenever their articles appear on the tech goliaths' platforms. We're talking snippets of stories in search results and link previews, up to whole articles.

The code also requires Google et al to alert media organizations ahead of any changes in content-ranking algorithms and in how news articles will be presented, and advise publishers of the upcoming updates.

The Aussie government says this is all to protect its nation's journalism industry. At a Senate hearing on Friday in Canberra, both Silicon Valley giants argued back, with Google threatening to cut off Google Search for all of Australia if the proposed code became law and was enforced.

Google rejects Australia’s revised pay-for-news plan, proposes its own plan instead

“The principle of unrestricted linking between websites is fundamental to Search,” Mel Silva, VP of Google Australia and New Zealand, said in her opening statement at the hearing. “Coupled with the unmanageable financial and operational risk if this version of the Code were to become law it would give us no real choice but to stop making Google Search available in Australia.”

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Considering more than 90 per cent of the world uses Google Search, that would be quite a blow to Oz's netizens, who would have to turn to other search engines like Bing or DuckDuckGo. If Google does, indeed, block off its search operation in Australia, it’d have to give up the revenues it makes off advertising Down Under.

“That would be a bad outcome not just for us, but for the Australian people, media diversity and small businesses who use Google Search,” Silva added. She argued that accepting the legislation would set an “untenable precedent” for its business.

The French method

Getting companies like Google and Facebook to pay publishers for their news isn’t too crazy of an idea. France passed a law that requires Google to negotiate with and pay publishers for reusing content under European Union copyright rules. In fact, Google announced it had agreed to do just that earlier this week. “[The] agreement with [Alliance de la Presse d'Information Générale] is a major step forward,” Sébastien Missoffe, CEO of Google France, said in a statement.

“It confirms Google's commitment to compensate publishers appropriately under French law, and opens up new opportunities for our publisher partners. We are happy to contribute to the development of news publishers in the digital age, to further support journalism.”

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The deal, however, only applies to publishers participating in Google’s News Showcase, a product announced last year that curates articles from selected publications. We're not on the list but if anyone wants to put in a good word for us, don't let us stop you [our invite probably got lost in the post – ed.]

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Given Google played ball in France, and is threatening to pull the plug in Australia, we can only assume the ads giant is acting tough to sway the legislative process in its favor Down Under.

Head of Facebook Australia & New Zealand Will Easton, meanwhile, said that “more work is needed to incentivise open commercial negotiations rather than an untested and unpredictable arbitration approach” detailed under Australia’s News Media Bargaining Code.

“We believe that deals reflecting genuine commercial value from both publishers and Facebook can still be reached before applying serious penalties under the law. We urge the government to address the unworkable components of this law.”

Google and Facebook declined to comment further. ®