So Google fancies itself a champion of small businesses, ey?
Such would be the implication of a sabre-rattling campaign it launched against an ACCC media bargaining code this week, in which threats range from slapping a price on Google’s free services to creating “dramatically worse” search results for Aussie users.
The US$1.06 trillion dollar multinational worries big corporations will enrich themselves under the code — at the expense of small businesses and YouTube creators — because Google would be forced to give the media a leg up by, *checks notes*, paying for content and keeping them apprised of unilateral decisions that affect their businesses.
Cue Australian Competition and Consumer Commission chair Rod Sims, who says Google won’t be compelled to charge for its services or share any additional user data with news businesses, deriding the US-headquartered company for peddling “misinformation” about the code.
But perhaps more galling is Google resorting to playing the small business card in its realpolitik engagements with legislators in Australia, the US and Europe.
The search giant’s apparent not-one-step-back policy towards attempts to regulate its immense market power has nothing whatsoever to do with protecting small businesses.
While platforms like Google love to sing the benefits of their services for business productivity, they omit the counterfactual, where the benefits of technological progress are reaped under sustainable bargaining conditions, not under the thumb of excessive market power.
Small business owners know this all too well, having many-a-time found themselves on the front lines in recent years; dealing with fraudulent reviews, alleged discrimination against YouTube creators and one of the greatest gate-keeping exercises of the 21st century: Google-centric search engine optimisation (SEO).
Last year, the ACCC’s in-depth investigation into digital platforms like Google and Facebook concluded small businesses have “no choice” but to engage with these multinational behemoths, not that business owners can ever get either platform on the phone to deal with their complaints.
Google rakes in US$116.3 per-user in advertising revenue each year in Australia, and upwards of 19 million users flock to its websites every month, according to the ACCC.
Yet we’re told the imposition of royalties on news content would birth the spectre of higher costs for users (businesses included) and worse search results.
All that market power sure comes in handy when you need to make some threats, ey Google?
The search giant’s primary gripe with the ACCC code (other than the imposition of new costs) appears to be the requirements to share some user data with news companies.
Colour us sceptical, but the idea the world’s data-collector-in-chief, currently being sued in Australia for overreach, is chiefly concerned with the privacy of its users is a bit difficult to believe.
Afterall, Google has built its business on knowing consumers, and taking advantage of markets where consumer data has not been priced, giving rise to the illusion its services are “free”.
Clearly the game Google is playing with regulators has global consequences; the ACCC and the Morrison government have found themselves at the front lines of an international fight over the balance of power between Silicon Valley and western governments.
The code hasn’t even emerged from its draft stage yet and we’re already being spammed by warning signs and the clear implication Google will consider the nuclear option of pulling out of search services in Australia — a threat that will test the resolve of Treasurer Josh Frydenberg.
Astute readers may remember we’ve been here before. Earlier laws that placed a GST burden on goods imported by Amazon under $1000 saw the US retail giant bar Australians access to its international platform, a move it later walked back from.
In that case, small businesses were on the receiving end of price competition from a company that wasn’t required to play by the same rules as everybody else — a product of the fact it had innovated through markets in ways not properly considered by the laws of the land.
But Amazon does not loom nearly as large over e-commerce as Google does over search and online media; more than 20% of time Australians spend online takes place on Google-owned websites.
We suppose, true to form, that should it pull out of search in Australia, Google would lament the loss of its services to small business owners.
The search behemoth isn’t the first to use small businesses as a political football, but if it expects Australia’s entrepreneurs to respond to threats, it’s going to be disappointed.
Business owners are practiced in spotting a fake, and Google’s professed devotion to SMEs in service of its own commercial interests is about as disingenuous as it gets.