Report commissioned by Google shows it’s helping Australia to the tune of AU$53b

Report commissioned by Google shows it’s helping Australia to the tune of AU$53b
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Google has published the findings of a report [PDF] it commissioned, with the messaging focused on the idea that the annual economic value it brings down under is AU$53 billion.

The search giant is touting the impact as valued at AU$39 billion for Australian businesses and AU$14 billion for consumers. It says an “overwhelming 97% of the business benefits” are experienced by non-technology sectors, while about 60% goes to small and medium-sized enterprises.

“By enabling business expansion through the successful use of products such as Google Ads, the company is estimated to support a total number of 116,200 jobs directly (in companies that have used these products), and a further 162,700 indirectly (in the supply chains of these companies) — this is in addition to its employment of 1,800 people in the country,” the summary of the report says.

Google has been in a stoush with the Australian government over its News Media Bargaining Code. The Google’s economic Impact in Australia report is another example provided by the company as to why its presence in Australia is beneficial, arguing previously it barely makes any money from news content — AU$10 million in revenue in 2019 — but that it offers the service as a way of educating and informing Australians.

The bargaining code, according to the government, is necessary to address the fundamental bargaining power imbalances between Australian news media businesses and major digital platforms. But to Google, it’s “unfair and unworkable”.

Google has at length said the code puts the “way Aussies’ search at risk”. It believes it contains an unfair arbitration process that “ignores the real-world value Google provides to news publishers and opens up to enormous and unreasonable demands”.

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Similarly, Facebook takes issue with the code, having threatened to pull news completely from its Australian platform.

See also: Not happy Jan: Google likens media bargaining code to using the Yellow Pages

The code entered the House of Representatives on the final sitting week of 2020, and its passage is slated for early 2021.

Expanding on the idea its services contribute AU$14 billion in benefits to consumers, Google Australia and New Zealand VP Mel Silva said this is achieved via productivity, convenience, and access to information.

She also said search saves users almost five days a year, and drivers save 5.6 hours per year using Google Maps.

Previously, Silva argued the draft code’s “must include, must pay” system was “extreme and unprecedented”.

“It essentially forces Google to provide a benefit to Australian news businesses and to pay them to receive that benefit,” Silva said.

GOOGLE VS US ATTORNEYS-GENERAL

10 US state attorneys-general jointly filed a lawsuit against Google in December, accusing the tech giant of acting anti-competitively in digital ad markets.

The complaint, which focuses on Google’s role in buying and selling display ads online, was filed by Texas attorney-general Ken Paxton on behalf of a 10-state coalition.

On the weekend, Google said it was looking forward to showing in court why Paxton’s allegations are wrong.

In an attempt to “set the record straight”, Google said ad tech “helps websites and apps make money and fund high-quality content”.

“AG Paxton tries to paint Google’s involvement in this industry as nefarious. The opposite is true. Unlike some B2B companies in this space, a consumer internet company like Google has an incentive to maintain a positive user experience and a sustainable internet that works for all — consumers, advertisers and publishers,” it wrote.

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“Here are just a few of the things AG Paxton’s complaint gets wrong: Myth: Google ‘dominates the online advertising landscape for image-based web display ads’. Fact: The ad tech industry is incredibly crowded and competitive.”

Further “debunking” claims made by Paxton, Google alleges that its fees are lower than reported industry averages; “open bidding” addresses the drawbacks of header bidding; and that its open bidding agreement with Facebook doesn’t harm publishers, as Facebook is one of over 25 partners in open bidding, and its participation helps publishers.

MORE FROM GOOGLE

  • ACCC code sees Google pause Australian rollout of News Showcase
  • Google wants publishers to decide if news is shown on its platform
  • Google hit with €1.49 billion antitrust fine by Europe over online advertising  
  • US antitrust probe finds ‘alarming pattern’ of innovation-stifling practices

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