France isn’t backing down from its bid to make Google pay to reference articles from French newspapers, even after the angered company threatened to altogether ban these articles from appearing in search results last week.
When Google Executive Chairman Eric Schmidt visits France next week, officials hope to convince the company to sit down for negotiations with publishers, said French innovation and digital economy minister Fleur Pellerin during a visit to MIT Technology Review’s Emtech conference today. She says she is not comfortable with the idea of a showdown with the search giant and hopes to avoid new copyright laws, but also said that “if they don’t want to negotiate, we’ll find other ways.”
French lawmakers want to pass a bill that would tax Google for content it currently indexes for free, after newspapers lobbied for the measure. Pellerin already met with French Google officials last week.
Google is facing pushback around the world over how it earns advertising revenues from media content while that industry struggles to stay afloat. The legislation follows a similar move by Germany, and last year in Belgium the search giant temporarily did follow through on its threat to pull search results until an agreement was reached two days later. Brazilian newspapers have taken the more extreme step of boycotting Google for the past year.
But Google has plenty of leverage in France and the rest of Europe. Pellerin said France’s ability to negotiate is weakened because there is no major competitor or alternative in search. The company dominates more than 90 percent of the search market, unlike in the U.S. where Yahoo and Microsoft’s Bing together have about a 40 percent market share. Google also set up offices in France last year, and has an R&D facilities in Paris, Pellerin says. The company noted in a letter it directs 4 billion people a month to French publishers’ pages, so a Google ban would be a significant blow to newspapers, too.
“It’s a very critical time for the business model for Google,” says Pellerin. In addition to issues over content, both E.U. and U.S. agencies are investigating the company for monopolistic practices, and countries are increasingly upset with how little the company pays in taxes overall.
“Google pays a 2.5 percent tax rate around the world, which is almost nothing,” she said. “The debate is really growing in Europe. Google is a great player and a great actor in the ecosystem. But it should maybe take more responsibilities,” she said.
Pellegrin was visiting Emtech as part of a campaign to attract technology and research investment to France. She showed off a pretty funny video that attempts to dispel stereotypes about French culture.
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