Google's letter warning that a new Australian law threatens free YouTube and search contains 'misinformation,' according to the country's consumer watchdog

• An open letter from Google warning that new Australian regulation would damage YouTube and Google Search in the country contains "misinformation," according to the country's competition watchdog.
• The draft regulation would force Facebook and Google to pay news publishers for their content.
• In the letter, Google said Australia's draft news code would hand people's personal data to "big news businesses," and threatens its free offerings in Australia.
• But Australia's competition regulator said Google would not be forced to charge for free services or hand data to news publishers.

Google has warned Australians in an open letter that the future of free YouTube and search is under threat from a new draft media code.

But on Monday morning, Australia's competition watchdog said the letter contained "misinformation."

The open letter refers to Australia's draft media code, which allows local news publishers to charge Google and Facebook "fair payment" for content for the first time.

In the letter, Google's Australia managing director Mel Silva said the proposed law, the News Media Bargaining Code, "would force us to provide you with a dramatically worse Google Search and YouTube, could lead to your data being handed over to big news businesses, and would put the free services you use at risk in Australia."

The code aims to redress a power imbalance between the big tech firms, which rely on content generated by users and professional publishers, and the news industry. The draft code was published in July. As yet, there is no date set for a final version.

Google claimed in its letter that it would be forced to tell publishers how to access user data, stating that "there's no way of knowing if any data handed over would be protected."

The ads giant, which made $162 billion in revenue for the full-year 2019, said it already paid the news industry "millions of dollars" and tried to forge partnerships. It said the new code gives "big media companies special treatment" and would enable them to make "enormous and unreasonable demands."

Australia's competition watchdog, the ACCC, hit back in a statement on Monday, saying the letter contained "misinformation" about the draft code. It said Google would not be forced to hand over data — nor would it be forced to charge for services that are currently free.

The ACCC added: "The draft code will allow Australian news businesses to negotiate for fair payment for their journalists' work that is included on Google services.

"This will address a significant bargaining power imbalance between Australian news media businesses and Google and Facebook."