Google is fined $591 million by a French watchdog for failing to negotiate reasonable contracts with local news producers.

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French watchdog fines Google $591M for failing to negotiate fair deals with local news publishers

Regulators are dissatisfied with Google’s concept of a fair bargain.

Google has been accused of not acting in good faith when asked to negotiate a reasonable payment for using news snippets throughout Search and Google News. As a result, the French competition regulator fined the company $591 million and will continue to punish it for failing to negotiate agreements with individual newspapers within two months of receiving such requests.

Google was fined €500 million ($591 million) in France this week for failing to comply with an order to negotiate a reasonable income share with news publishers whose material appears on the Google News site. It’s a significant blow for the search giant, and the second-biggest dealt by French authorities to any company.

Back in 2020, the French competition watchdog utilised the EU’s Copyright Directive – often known as the “Link Tax” by some – to require Google to pay authors for the usage of snippets or article previews across services such as Search and Google News. The contentious judgement forced Google to choose between striking a deal with publishers and removing snippets entirely.

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Google prefered the latter option, gradually restoring snippets for publishers who allowed the firm permission to do so, but this did not sit well with the French authorities.

The search giant also introduced a $1 billion initiative called Google News Showcase aimed at supporting high-quality journalism in Europe on the company’s own terms, while maintaining the position that publishers benefit greatly from Google’s services that funnel visitors to their websites.

Earlier this year, Google reached an agreement with a French newspaper group, but individual rates were still a nebulous that had to be sorted out through separate negotiations with each publisher. Bloomberg notes regulators were unimpressed with some of the payment offers, going as far as calling them “negligible.”

The French competition watchdog’s director, Isabelle de Silva, said in a statement that the fine “takes into account the exceptional seriousness of the breaches observed.” She also stated that Google offered to pay less for news articles than weather information or dictionary entries.

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Google must now hold discussions with publishers within two months of receiving such requests. In the event that this is not achieved, the firm will be penalised up to €900,000 ($1.06 million) each day. Of course, the search giant is unhappy by the decision and feels it has “acted in good faith throughout the entire process,” adding that the punishment disregards their efforts to reach an agreement “and the reality of how news works on our platforms.”

Last year, Google encountered similar challenges in Australia, and at one point threatened to withdraw its search engine from the nation in protest of a similar rule forcing search engines to pay for linking to news items. Since then, the company has reached a number of deals with publishers in Australia, the UK, and Canada to pay for news snippets and even integrate them into Google News Showcase.

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