Skip to main content

Google Threatens to Shut Off Australia Over Media Protection Law

Google threatens to disable its search engine in Australia if it’s forced by a proposed law to pay local publishers for news.

Alphabet-owned Google  (GOOGL) - Get Alphabet Inc. Report has threatened to disable its search engine in Australia if it’s forced to pay local publishers for news - something that is currently being contemplated by lawmakers as a way to protect local media providers.

A proposed law, intended to compensate publishers for the value their stories generate for the company, is “unworkable,” Mel Silva, managing director for Australia and New Zealand, told a parliamentary hearing Friday. She specifically opposed the requirement that Google pay media companies for displaying snippets of articles in search results.

Google's threat is a dramatic escalation in a months-long standoff with the Australian government, which said the legislation was designed to support the local media industry, which includes Rupert Murdoch’s News Corp.

Facebook  (FB) - Get Meta Platforms Inc. Report, the only other company targeted by the legislation, also opposes the law. The social media giant reiterated at Friday’s hearing that it's considering blocking Australians from sharing news on Facebook if the law is pushed through.

Why Google Should Not Fear Antitrust Action

Scroll to Continue

TheStreet Recommends

“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,” Silva told a panel of senators. She described the law as an “untenable financial and operational precedent.”

“We don’t respond to threats,” Australia Prime Minister Scott Morrison said Friday. “Australia makes our rules for things you can do in Australia. That’s done in our parliament. It’s done by our government. And that’s how things work here in Australia.”

Separately, Google parent Alphabet announced Thursday that it was shutting down Loon, a division it launched in 2013 that provides wireless internet from floating balloons. Loon launched its first commercial internet service in Kenya in July, comprised of a fleet of about 35 balloons that covered an area of around 50,000 square kilometers. 

Loon also has provided internet services to areas affected by natural disasters, deploying balloons to Puerto Rico following Hurricane Maria in 2017 and to Peru following an earthquake there in 2019.

Alphabet and Facebook are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells the stocks? Learn more now.