Google CEO Sundar Pichai earned a £1.4million salary last year plus a £173million stock package
France has fined Google £425million for failing to negotiate ‘in good faith’ with media companies over the use of their content under EU copyright rules.
It is the biggest fine ever imposed by France’s competition regulator for a company’s failure to adhere to one of its rulings.
The long-running legal row focuses on claims Google has been showing articles, pictures and videos produced by media groups when displaying search results without adequate compensation.
The move comes amid a wider battle to force Google and online platforms to pay for news content following the seismic shift of advertising revenue online.
The Competition Authority also threatened fines of another £750,000 per day if Google doesn’t come up with proposals within two months on how it will compensate publishers and news agencies for their content.
The watchdog’s president Isabelle de Silva said: ‘When the authority imposes injunctions on companies, they are required to apply them scrupulously, respecting their letter and their spirit. In the present case, this was unfortunately not the case.
‘Google’s negotiations with publishers and press agencies cannot be regarded as having been conducted in good faith.’
A Google spokesperson said in a statement to AFP that the company was ‘very disappointed’ by the decision.
It is ‘the biggest ever fine’ imposed by the Competition Authority for a company’s failure to adhere to one of its rulings, the agency’s chief Isabelle De Silva (pictured) said
‘We have acted in good faith during the entire negotiation period. This fine does not reflect the efforts put in place, nor the reality of the use of news content on our platform,’ the company insisted.
‘This decision is mainly about negotiations that took place between May and September 2020. Since then, we have continued to work with publishers and news agencies to find common ground.’
In April 2020, the French competition authority ordered Google to negotiate ‘in good faith’ with media groups after it refused to comply with a new EU law governing digital copyright.
French watchdog’s damning ruling
In Tuesday’s decision, the watchdog focused on a few specific violations of its orders by Google.
- Google’s negotiations with publishers and press agencies cannot be regarded as having been conducted in good faith;
- The tech giant pushed news publishers to negotiate deals for Google News Showcase, which lets publishers package stories with panels and features like timelines, while excluding income from general search results;
- Google told French news agencies including AFP they couldn’t pursue payments if their content appeared on other news sites and came up in search results;
- The US company must now come up with proposals within the next two months on how it would compensate news agencies and other publishers for the use of their news;
- If it does not do that, the company would face additional fines of up to €900,000 per day.
The so-called ‘neighbouring rights’ aim to ensure that news publishers are compensated when their work is shown on websites, search engines and social media platforms.
But last September, news publishers including Agence France-Presse (AFP) filed a complaint with regulators, saying Google was refusing to move forward on paying to display content in web searches.
In particular, the Competition Authority rebuked Google for having failed to ‘have a specific discussion’ with media companies about neighbouring rights while negotiating over the launch of its Google Showcase news service, which launched late last year.
News outlets struggling with dwindling print subscriptions have long seethed at Google’s refusal to give them a cut of the millions of euros it makes from ads displayed alongside news search results.
The search giant counters that it encourages millions of people to click through to media sites, and it has also invested heavily in supporting media groups in other ways, including emergency funding during the Covid-19 crisis.
Google, whose CEO Sundar Pichai earned a £1.4million salary last year plus a £173million stock package, announced in November that it had signed ‘some individual agreements’ on copyright payments with French newspapers and magazines, including top dailies Le Monde and Le Figaro.
It comes as Google and other tech giants faces mounting pressure to pay news providers for their content amid the online shift.
In February, Australia and Facebook were engaged in a bitter row which saw the social media company block all news content to Australian users after the government tried to introduce a new law forcing it to pay for content.
Facebook was condemned by politicians and users around the world after it blocked 25million Australians from viewing and sharing news articles on February 18.
France has fined Google £425million for failing to negotiate ‘in good faith’ with media companies over the use of their content under EU copyright rules
The move – which also banned charity, health authority and emergency service pages – came after Australia’s news media bargaining code passed the lower house of Parliament on February 17.
Following talks with Facebook boss Mark Zuckerberg, the government made last-minute changes to the law which convinced him to revoke the ban.
The news code encourages tech giants and news companies to negotiate payments between themselves, and orders Facebook and Google to invest in local digital news.
If negotiations break down, an independent arbitrator can set the price the tech companies must pay to the media companies.
Some hoped the move would signal a sea change in how online platforms work with publishers.
But in the UK in May, Labour peer Lord Dubs stressed during a debate in the House of Lords that social media giants are ‘paying nothing for news content’.
Lord Dubs (pictured) advocated for online platforms to ‘pay news providers for the news’
He added that Google and Facebook took 80 per cent of the £14billion spent on digital advertising in 2019, but national and local newspapers took just 4 per cent.
The 88-year-old said ‘the Australian Government have shown the way to do it; we should do likewise’, following legislation there to make tech firms pay for using news.
Meanwhile Lord Black of Brentwood said that the pandemic has taught people of the need for ‘reliable, verifiable’ news from trusted sources, but warned that the threats against this are becoming ‘existential’ as revenues evaporate.
He noted that more than 260 local newspapers have disappeared since 2005, and that in the last year, there have been more than 2,000 job cuts in media in the UK.
Lord Black added that ‘the situation is grave, particularly for the local and regional press, which are now in real peril.’
Earlier this year, Google agreed a licensing deal with more than 120 UK publications in a first deal of its kind in the UK.
Google News Showcase means publishers will be paid for excerpts of news articles that appear in search results, and users can then be directed to the full story on the publisher’s website.
It was the first time Google started to pay for news content in the UK and is part of the tech giant’s pledge to invest £750million in news worldwide.
President of France’s competition regulator Isabelle de Silva said Google did not ‘negotiate in good faith with publishers’
‘When the Authority imposes injunctions on companies, they are required to apply them scrupulously, respecting their letter and their spirit. In the present case, this was unfortunately not the case.
‘At the end of an in-depth investigation, the Authority found that Google had not complied with several injunctions issued in April 2020.
‘First of all, Google’s negotiations with publishers and press agencies cannot be regarded as having been conducted in good faith, when Google insisted that the discussions take place within the framework of a new partnership, called Publisher Curated News, which included a new service called Showcase.
‘In doing so, Google refused, as it has been asked on several occasions, to hold a specific discussion on the remuneration due for current uses of content protected by neighboring rights.
‘In addition, Google unjustifiably restricted the scope of the negotiation by refusing to include content from press agencies included in publications (images for example) and by excluding all the non-IPG press from discussions, even though it is undoubtedly affected by the new law, and its content is also associated with significant revenues for Google.
‘These breaches were aggravated by the non-transmission of information that would have allowed fair negotiation, and by the violation of obligations aimed at ensuring the neutrality of the negotiation vis-à-vis the display of protected content and existing economic relations by elsewhere between Google and publishers and news agencies.’