French antitrust regulators fined Google, a subsidiary of Alphabet Inc, $593 million for not negotiating with news publishers on handling news on their platform. This is a big win for media companies that have faced significant revenue drops that they accuse the multinational tech company of causing. This has happened at a time when online tech and social media giants such as Twitter, Facebook, and Google are receiving global pressure to share some of their earnings with media companies.
French authorities have been accusing Google of failing to comply with a 2020 order from French watchdogs to come up with a deal with media firms to use article snippets when showing search results. Google has been given a two-month deadline to devise a plan of how to compensate publishers and other news agencies for using their news. Failure to do that, the company will face up to €900,000 per day in additional fines.
This penalty is much more than what Google had planned to pay publishers in France. According to a reliable source, the Tech giant had made a deal with 121 French publishers to pay a sum of $76 million.
Events leading to this fine
In April 2020, the French regulators ordered the Tech giant to negotiate a deal in good faith with publishers. At first, Google sought to evade this process by not displaying content snippets along with links in the Google News section in France. However, the authorities realized this would be an abuse of power by a superior company. They ordered the Silicon Valley giant to stop avoiding the law and negotiate a deal with media companies.
The Alliance de Presse d’Information Générale (APIG), The Syndicate of magazine press publishers (SEPM) and Agence France Presse (AFP) presented their complaints between August and September 2020. This kicked off an investigation that lasted for months. These companies and a few others argued that Google was unwilling to give them critical information regarding how they made their payments.
Aftermath of the fine
Google, which is still in a position to appeal this fine, stated that it was not happy with this decision, but it would have to comply. The company has since agreed on new deals with top news publishers in France, such as Le Figaro and Le Monde.
On the other hand, the French authorities said this fine resulted from Google placing unfair restrictions on negotiations with various media outlets. This included forcing them to be participants in their licensing program called News Showcase.