Google is threatening to stop linking to New Zealand news sites if the law is passed

Photo: Unsplash

Google has warned it will be forced to stop promoting New Zealand news content and stop doing business with local newsrooms if the government pushes through the Fair Digital News Bargaining Bill.

The bill introduced by the Labor government would force tech giants to pay news organizations for their content.

National did not initially support the bill, but the coalition is pushing it forward.

A statement released today by Caroline Rainsford, Google's New Zealand country director, said the company was “concerned” about the bill and did not believe it was the right approach to promote a sustainable future for news.

“This bill proposes a 'link tax' that would require Google to pay for linking to news articles alone. While Google supports efforts to promote a sustainable future for New Zealand news, this bill is not the right approach.”

Google said it had been transparent with the government that if the bill passed, Google would make significant changes to its products and messaging investments.

“Specifically, we would be forced to stop linking to news content in Google Search, Google News or Discover interfaces in New Zealand, and cease our current commercial agreements and ecosystem support with New Zealand news publishers.”

The company also announced it would end its commercial agreements with New Zealand news publishers.

“These are not outcomes we want for New Zealanders, news publishers or our business.

“We believe there is a sensible way forward and have proposed to the Government sensible alternatives that do not harm smaller, local or regional publishers and preserve the principles of the open web, in line with recent agreements we have reached elsewhere .”

It worked with New Zealand publishers and lawmakers, the statement said, and “proposed sensible and balanced alternatives to the bill”.

“Further strengthening New Zealand’s news industry requires additional public and private support from both the New Zealand government and a broad base of private businesses.”

Google said it was proud of its “long-standing contribution to the New Zealand news industry”.

“Our services help bring quality journalism to New Zealanders every day, driving valuable traffic to publishers.”

Through local partnerships and investment, we continue to contribute to a sustainable, diverse and innovative news ecosystem in New Zealand, including through Google News Showcase – a licensing program that covers over 95 percent of New Zealand's digital news publishers and brings us millions Paying dollars a year to nearly 50 local publications.”

His main concerns:

• Ineffective and against the open web: Link taxes are contrary to the principles of the open web and have not proven effective in supporting journalism, as demonstrated in similar situations where other platforms backed out after deciding that it was no longer possible to distribute news links are, among others, in Australia and Canada. The Ministry of Culture and Heritage commissioned an independent report from Sapere, which concluded: “There is no plurality that justifies requiring digital platforms to pay news companies for linking to news content.”
• Harmful for smaller publishers: Solutions that predominantly benefit a small number of large operators at the expense of small and local language publishers are neither sustainable nor desirable outcomes for New Zealand.
• Business uncertainty: The unlimited financial risk, an opaque political process for exemption and the ambiguity in the current draft law result in an unsustainable level of business uncertainty for any company. This makes it impossible to plan and invest effectively in New Zealand.

Asked how much revenue could be gained from paying big tech companies, Media and Communications Minister Paul Goldsmith told RNZ in July that it would depend on negotiations.

“There has been talk that around $30 million could be at stake in connection with the Google agreement. The additional advertising revenue could potentially generate around $6 million, but it depends on how the negotiations go.”

Responding to Google, Goldsmith said in a statement that there are differing views in the sector he is considering.

“We are still in the consultation phase and will make announcements in due course.”

He said he and his officials had met with Google “several times to discuss their concerns” and would continue to do so.

The ACT party was against it

The ACT Party is opposed to the bill and has invoked the “agree to disagree” clause in the coalition agreement to vote against it.

David Seymour.
Photo: RNZ/REECE BAKER

Responding to Google, ACT leader David Seymour said in a statement the government was playing “chicken” with the tech giant and “New Zealanders will lose.”

“ACT has always said this Labor government bill would not work, so we have agreed to disagree with our partners on it.

Seymour renews his call for National and New Zealand First to drop the bill.

“If Google carries out its threat, New Zealand audiences and media companies will be worse off. Smaller media companies in particular would suffer as they would be denied the opportunity to get in touch with new target groups via search results.”

Seymour said it is not a government's job to protect companies from customers making different decisions.

“The internet has made it easier than ever to report news, and certain media outlets need to stop blaming the internet and start looking at their products.”

“It is not correct to describe the bill as any kind of 'negotiation'. Instead, politicians would decide who gets what,” Seymour added, “undermining the separation between government and media that is fundamental to democracy.”