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My understanding of the regulation is that it requires a good faith negotiation. Not Google/FB/DDG/Bing just paying what the media organisations demand. Google'

My understanding of the regulation is that it requires a good faith negotiation. Not Google/FB/DDG/Bing just paying what the media organisations demand. Google's posturing inherently indicates they aren't negotiating in good faith and are attempting to use their market power to pay less than what most would consider equitable (I have no figures at all or even ballpark so who knows what that actually is). Arbitration is just that, arbitration. It doesn't mean media organisations say we demand x and that's what the settlement is. Both sides present their case to the arbitrator who decides on the price. If you're in DDG/Bing's position, you put your cards on the table and take the extra revenue from having a massive boost to market share. It is highly unlikely an arbitrator would actually set the price at an unsustainable value. If it means the search engine is actively making a loss overall then of course they'll walk away. But for DDG/Bing, making a loss on news links may be worth it for the extra revenue in non news search. In reality it probably wouldn't even be a loss, just a much lower profit margin. Obviously Google is going to try and pay as little as possible, any business would. The difference is market share and power dynamics. Google believe they are in the position that if they can't get the price they want they can walk away. To the no. 2/3 player in the market it presents to a massive opportunity if google does walk away. According to the latest guardian article [1] on this, Google declared $134M in profit in Australia last year on $4.8B. That's a big incentive for player no 2/3 to pay some of that profit to the media organisations. [1] https://www.theguardian.com/media/2021/jan/22/google-threatens-to-shut-down-search-in-australia-if-digital-news-code-goes-ahead https://www.theguardian.com/media/2021/jan/22/google-threate... [edit] fixed spelling/grammar

sidibe 6y ago
Not all of that revenue is search. When you add consider not all of that revenue is from Search, the cost of compliance (adding more to legal team and the toil of actually negotiating with all the other parties), much less actually paying for the links, they might see it as genuinely not worth it so it might not just be a case of punishment for Australia daring to regulate them. In that case, other search engines that pick up enough market share for the law to apply to them, which will probably much less profitable to begin with, will feel the same way.
- anon98356 6y ago
  You're right it won't all be search revenue. What I guess I'm trying to say in a nutshell is: For a competitor, the overall boost in revenue due to a much higher all round use of their search engine is likely to offset the extra costs associated with serving news content.

sidibe 6y ago

Not all of that revenue is search. When you add consider not all of that revenue is from Search, the cost of compliance (adding more to legal team and the toil of actually negotiating with all the other parties), much less actually paying for the links, they might see it as genuinely not worth it so it might not just be a case of punishment for Australia daring to regulate them. In that case, other search engines that pick up enough market share for the law to apply to them, which will probably much less profitable to begin with, will feel the same way.

anon98356 6y ago
You're right it won't all be search revenue. What I guess I'm trying to say in a nutshell is: For a competitor, the overall boost in revenue due to a much higher all round use of their search engine is likely to offset the extra costs associated with serving news content.