Protecting Google from defamation is worth seriously considering


Michael Douglas, University of Western Australia

It has been a huge week for defamation law.

Last Thursday, the NSW Government announced a push to reform Australia’s uniform defamation laws. It is calling for a “cyber-age reboot”. That proposal was backed by a “statutory review” of the NSW Defamation Act. At a meeting of the Council of Attorneys-General, the states and territories agreed to reconvene a working party to consider reform of equivalent statutes around Australia.

The following Wednesday, the High Court delivered its most important defamation judgment in years. In a case that fits perfectly with the theme of the NSW proposals, Milorad “Michael” Trkulja succeeded in his appeal against Google. The Court found that Trkulja could sue the American company for defamation in respect of search results which potentially indicated that he had ties to Melbourne’s criminal underworld.

The next morning, the Victoria Court of Appeal allowed Bauer Media’s appeal from the judgment that awarded Rebel Wilson A$4.5 million in damages. The Court held that Wilson was entitled to A$600,000, and not to millions extra for lost opportunity to earn from roles that she may have been offered had the defendant not defamed her in its gossip magazines. The previous assessment of damages depended on the spread of the defamatory allegations on the internet via the “grapevine effect”.

The record for Australia’s largest defamation judgment is now barrister Lloyd Rayney’s A$2.6 million defamation win against the State of Western Australia, litigated by Perth firm Bennett + Co. If Rayney’s current appeal is successful, that figure may increase even further.

There’s a lot to think about.

The NSW proposal to allow large corporations to sue for defamation is particularly worrying. It would have a significant chilling effect on journalism.

But the issue that the NSW government chose to highlight from its statutory review was that defamation law is ill-equipped for the digital era. I agree that the way we communicate has completely changed in the 13 years since our Uniform Defamation Acts were introduced.




Read more:
Defamation in the digital age has morphed into litigation between private individuals


Trkulja v Google shows it is time for reform

Trkulja was shot in the back in a Melbourne restaurant in 2004. As you’d expect, people wrote about it on the internet. Google provided access to that content through its search engine: web crawlers discovered web pages relevant to Trkulja, indexed them, and ranked them via its Google Search algorithms.

The result of those processes was that Trkulja was associated with some shady figures through Google search. A Google image search for his name would display Trkulja’s picture with those of Melbourne criminals. The results pages contained keywords like “melbourne criminals” and “melbourne underworld photos”.

Google’s autocomplete results would also cast him in a poor light, returning terms like “michael trkulja criminal” or “michael trkulja underworld”. The results page linked to content which described Trkulja as a “former hitman”.

Trkulja sued, claiming that this computer-generated material defamed him. Google argued that the claim was so weak that it should come to an end even before a trial. Victoria’s Supreme Court rejected Google’s argument.




Read more:
Craig McLachlan, defamation and getting the balance right when sexual harassment goes to court


But the Victorian Court of Appeal allowed Google’s appeal, agreeing that the claim had no prospect of success. It found that the ordinary, reasonable person would not understand that the search results conveyed “imputations” which damaged Trkulja’s reputation. In their view, ordinary people would understand that there may be a disconnect between the words you type into Google and the results that follow.

On further appeal, the High Court unanimously decided that the Court of Appeal was wrong. At least some of the search results complained of had the capacity to convey the idea that Trkulja was associated with dodgy characters. Trkulja was given “the green light to sue” Google. Trkulja’s claim can now proceed.

Even before this case, you could sue Google for defamation

Like other foreign companies, Google is not immune to litigation because it is based overseas. On old principles, Google can be responsible for third party content which it “published” by sharing. It might have a defence of “innocent dissemination”, but perhaps not if the defamed person drew the problem to the company’s attention.

People have won against Google before. A few years ago, Janice Duffy succeeded in her claim that Google should be responsible for linking to defamatory websites. So in a sense, yesterday’s judgment is nothing really new.

It does provide some clarity on whether something like search results has the “capacity” to convey defamatory meaning. It is likely that Google will continue to be sued by all sorts of people who are aggrieved by search results that cast them in a poor light.

The case also demonstrates that our old laws are perhaps ill-suited to the digital era.

We should stop shooting the messenger

Reflecting on this case, it is worth considering whether we should cut internet intermediaries some slack when it comes to defamation law.

We could do so by giving effect to the “safe harbour” proposal flagged in the NSW statutory review. It would provide internet intermediaries with a shield from liability for third parties content. Telcos already enjoy something like this in Australia, which protects them from liability for copyright infringement.

Faced with cases like Trkulja, you would understand if Google simply acceded to every request to remove content from its search results. But what if Google did that for complaints by paedophiles, murderers or dictators?




Read more:
Before you write that scathing online review, beware of defamation


Google provides a free public service which is indispensable to our way of life. Without Google’s assistance, many of us would be lost online. When access to the functionality of Google and other intermediaries is limited, our substantive access to information is limited.

Extending safe harbour to internet platforms is worth seriously considering – other countries, like the United States, are already doing this.

The ConversationThe NSW statutory review does not go into these difficult issues in enough depth. In light of the rapid developments in media and technology, the best way forward is for the Australian Law Reform Commission to consider this in detail. We need to make sure that we get the right balance between freedom of speech, free access to information, and protection of reputation.

Michael Douglas, Senior Lecturer in Law, University of Western Australia

This article was originally published on The Conversation. Read the original article.

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News outlets air grievances and Facebook plays the underdog in ACCC inquiry



File 20180507 166906 1x6rsur.jpg?ixlib=rb 1.1
The ACCC inquiry looks at the impact of digital platforms on the supply of news and journalistic content.
Shutterstock

Andrew Quodling, Queensland University of Technology

The recent Cambridge Analytica scandal and congressional testimony of Facebook CEO Mark Zuckerberg has brought global attention to the power and influence of Facebook as a platform. It has also invigorated discussions about how such platforms should be regulated.

Meanwhile, the Australian Competition and Consumer Commission (ACCC) has been conducting an inquiry into the influence of digital platforms on media and advertising markets in Australia.




Read more:
Google and Facebook cosy up to media companies in response to the threat of regulation


Submissions to the inquiry by a range of media outlets, advertisers, as well as Google and Facebook, were published last week. Although Facebook has expressed interest in participating in regulatory debates, its submission is a disappointing early indication of how we might expect the company to downplay its magnitude and its roles in future regulatory debates.

The purpose of the inquiry

Late in 2017, the Federal Treasurer, Scott Morrison, directed the ACCC to conduct the inquiry into digital platforms, including search engines, social networks and other aggregators. As part of the ongoing inquiry, the ACCC will consider:

the impact of digital platforms on the supply of news and journalistic content and the implications of this for media content creators, advertisers and consumers.

It came about as a result of negotiations between the government and the former independent Senator Nick Xenophon. Xenophon insisted on the inquiry in exchange for his support for the government’s changes to Media Ownership laws.

To some extent, the inquiry retreads familiar ground. Old anxieties about declining revenues for journalistic organisations and the advent of internet technologies and internet-focused stakeholders continue a conversation that has been going for well over a decade.

News outlets air grievances

In total, the ACCC published 57 submissions. This includes contributions from most major Australian media organisations, industry bodies, unions and advertisers.

Many respondents took the opportunity to criticise the narrow scope of the inquiry. The inquiry’s scope is somewhat frustrating considering the complexities digital platforms present. They impact not just media and journalism markets, but also aspects of political, social and everyday life.

While the ABC’s submission was generally favourable in its discussion of online platforms, other Australian media organisations used the inquiry as an opportunity to air grievances about the impact of digital platforms.




Read more:
Government regulation of social media would be a cure far worse than the disease


News Corp accused the platforms of abusing the local market and engaging in anti-competitive practices. Commercial Radio Australia pointed to a lack of regulation compelling transparent and structured audience metrics. Nine complained of declining revenues and a lack of platform-specific regulations, while Foxtel raised the issue of copyright infringement.

Seven West Media and Ten argued that there is a barrier to entry imposed on traditional publishers by the significant existing collection of personal data that platforms like Facebook and Google can leverage.

The platforms respond

In their submissions, Facebook and Google both attempted to build a narrative that emphasised how the tools and systems they provide can empower journalists and other content creators. Meanwhile, they minimised or outright ignored the opportunity to discuss the broader concerns of the broadcasters, publishers and individuals who are stakeholders in the industries Facebook and Google are operating in.

Google’s short response to the inquiry is not particularly interesting, in part due to its brevity and its focus on championing Google’s notionally positive influence for publishers. Facebook had significantly more to say in its 56 page submission, which also gives context to Mark Zuckerberg’s recent comments welcoming the potential for regulation.

Facebook plays the underdog

Facebook’s submission reveals how the company portrays itself to regulators, with an interesting element of self-deprecation. Take for example, the statement that:

Facebook is popular, but it is just one small part of how Australians connect with friends, family and the world around us.

Given a user-base that dwarfs the population of, well, even the most populous countries, Facebook’s most compelling option for presenting itself as an underdog in this space is to compare itself by share of “attention”, rather than share of market.

Facebook presents “multi-homing” – the practice of having and using a variety apps on your phone – as a key concern. It paints a picture of precarity in a marketplace that they dominate.




Read more:
How to regulate Facebook and the online giants in one word: transparency


Facebook’s arguments about competition also ring hollow because the platform’s design and scale allows it to benefit from significant network effects.

Put simply, a network effect is when existing and new users benefit from the growth of a network. A familiar example of these effects can be seen in the services of mobile phone network providers. Telstra and Optus provide cheaper, or no-cost calls or messaging between customers of their own service.

But the similarities end there. While you could still call a friend with a competing mobile phone provider, there is no such interoperability with platforms like Facebook. This design helps Facebook protect its market power by keeping total control over the Facebook platfom’s network.

If you decide to leave Facebook, you sever the connections between yourself and other users of the platform. Given Facebook’s focus on augmenting social functions this can, quite literally, be an ostracising endeavour. In spite of both the recent Cambridge Analytica revelations, and several #deletefacebook campaigns, we’re yet to see a significant exodus of users from the platform.

A disappointing response

Facebook has a colossal user base. Over two billion people use the platform each month, and almost three quarters of those people use Facebook on a daily basis. It owns Instagram and WhatsApp – each of which are profoundly successful platforms in their own right.

The ConversationFacebook is a titan of this industry, and the sooner it stops pretending to be a bit player, the richer our discourse about platforms and their role in society can become.

Andrew Quodling, PhD candidate researching governance of social media platforms, Queensland University of Technology

This article was originally published on The Conversation. Read the original article.

A memo to Google – firing employees with conservative views is anti-diversity


Akshaya Kamalnath, Deakin University

Google’s recent sacking of James Damore for circulating a memo will do the tech giant more harm than good. Not only has the memo been incorrectly dubbed “anti-diversity”, but a majority of Google employees surveyed in a recent poll disagreed with the decision to fire Damore.

A more productive response to the memo would have been to setup an official channel for employees to air these kinds of issues. This way employees feel their views are heard and the company can take into account different points of view while formulating policy.


Read more: What the Google gender ‘manifesto’ really says about Silicon Valley


Google’s chief executive, Sundar Pichai, wrote to all Google employees saying that Damore’s memo had crossed the line by “advancing harmful gender stereotypes in the workplace”. It might have been more advantageous to have a full and frank discussion of Google’s diversity policies and what they are intended to achieve.

Is it too dangerous to talk about diversity?

Although painted as “anti-diversity”, the memo itself raises issues of the alienation of conservative views at Google and the need to be able to discuss diversity more openly. In other words, diversity shouldn’t be a concept that people are scared to discuss openly for fear of being vilified or shamed.

Damore’s memo suggests that those with differing views on diversity are dismissed and vilified. The response to his memo seems to prove his point. This might in fact be the heart of the problem – fear of saying something politically incorrect might in fact be holding people back from understanding the need for diversity measures.

One study found that American corporate directors thought board diversity (in racial, ethnic and gender terms) was an important goal worth pursuing. But they seemed unable to substantiate this opinion with examples of how board diversity might help the company. The authors of the study concluded that diversity seemed to be a “dangerous” subject to talk about.

Shutting down differing views on the matter is antithetical to the idea of diversity. “Inner diversity”, meaning diversity of viewpoints and opinions, is as important as “outer diversity”, in terms of gender and ethnicity etc.

A Canadian report on women on company boards found that boards with more women surpass all male boards in their attention to audit and risk oversight and control. It also highlights that outer diversity (such as having more women on the board) is a proxy for inner diversity – it is a sign of different “gifts, skills, experiences, and perspectives”. If a company focuses singularly on outer diversity while discouraging diverse viewpoints it won’t realise the real benefits of diversity in the first place.

Rationales for diversity

The rationale for measures promoting diversity is twofold. Women and minority groups have to overcome many barriers including selection bias while being recruited. And diversity, particularly in problem-solving groups, is ultimately good for business.

Diversity measures seek to reduce (if not eliminate) biases by expanding or diversifying the pool of candidates being considered for each position. For example, programs where female candidates are given mentors opens up new opportunities.

Damore’s memo argues the biological differences between men and women might be one of the reasons for the low number of women in the tech industry. However, recent neuroscience research shows there is not enough evidence to conclude that there are significant differences in the male and female brain. So while Damore’s view is not unequivocal, this perception could impede the effectiveness of diversity measures.

Other research shows that more men than women study computer science, engineering, physics and mathematics in the US. This could account for some of the gender disparity in tech companies. However, this is not true in all countries.

For instance, women make up nearly half of computer science and computer engineering students in India. It might be interesting to study what factors deter women in the US from studying these subjects.

But in order to address these issues it is necessary to be able to discuss them, and then assess what a diversity policy is intended to fix. To that end, companies must create forums and events to discuss the rationales for diversity policies and also allow employees to voice their views in this regard.

The ConversationA starting point could be to have employees fill out anonymous surveys to gauge perception of diversity policies. Based on this, appropriate discussions can be encouraged. Companies could also consider making the rationale for the diversity policy available along with the policy itself. This process will result in more informed policy choices and perhaps a more inclusive work culture.

Akshaya Kamalnath, Lecturer, Deakin University

This article was originally published on The Conversation. Read the original article.

Google, Facebook fall into line on tax, but eBay remains defiant


Michael West, University of Sydney

Under pressure from the Australian Tax Office, Google and Facebook have begun to bring their revenue onshore to be taxed. eBay remains recalcitrant, still deeming its Australian business to be a Swiss business and thereby avoiding millions in income tax and GST. The Conversation

It is multinational reporting season once again and the early signs are the government’s multinational tax avoidance laws are starting to work. But the world’s largest corporations are still paying a fraction of their fair share of tax in this country.

Until this year, Google and Facebook entertained a corporate structure that booked the billions of dollars of revenue they made in Australia directly offshore. However, eBay is still blithely pretending it doesn’t have an Australian business and that the billion dollars a year it makes from operating its online auction house in this country – through which Australians buy and sell things with other Australians in Australia – is really the business of an entity residing at 15 Helvetiastrasse, Bern, Switzerland.

According to its accounts, the latest for the year to December 2016, eBay Australia is still masquerading as being in the business of “the recommendation of market penetration strategies” on behalf of eBay International AG.

So it is that every cent of the $59 million that eBay disclosed as its cash-flow statement for 2016 came from related parties, mostly for “rendering of services”. On this, eBay paid $1.9 million in tax after ratcheting up its costs by $13 million to wipe out most of the $20 million uplift in cashflow. The average salary at eBay, if the accounts can be believed, is $312,553 – 109 employees, according to the directors’ report, getting $34.1 million.

Mind you, according to the directors’ report, these 109 people are engaged in carrying out the principal activities of the company, which are “the recommendation of market penetration strategies, advertising and promotion activities”.

Gobbledygook, but the numbers are irrelevant anyway. The estimated billion dollars or more which eBay is said to make in Australia is not even included in its financial statements, just the revenue from its secretive associates. Moreover the accounts are not consolidated, according to the notes, rendering the entire disclosure a farce. Auditor is PwC.

Funnily, though, the cover page Form 388, authenticated by EY, talks about “consolidated revenue” and “consolidated gross assets” – despite the fact that PwC says the accounts are not consolidated.

So eBay is the quintessence of the undisclosed agency, a puppet regime designed to whisk Australian profits offshore to a tax haven. The shadow directors are in Bern and the ultimate parent eBay Inc is in the US.

Over the past 15 years, eBay has dodged GST and paid income tax of just $8 million (almost one-fifth of its bill for “professional fees” at $38 million), despite its billions of dollars in cash-flow.

Positive signs of change

Focusing on more positive developments on the multinational tax scene, arch-tax avoider Google Australia and New Zealand is now recognising that a portion of the profits it makes in Australia are in fact Australian rather than Singaporean.

Industry observers believe Google makes about $3 billion in sales from its advertising business here. Until this year, its only revenue has come from three related parties via service arrangements. Now, with the introduction of the multinational anti-avoidance legislation, Google has recognised roughly one-third of its Australian revenue as Australian.

In the broader context it is worth considering the effect of the digital revolution on Australia’s tax base.

Where the TV networks, News Ltd (though belligerent on the tax front) and Fairfax Media once paid hundreds of millions of dollars a year in tax collectively, they are now struggling to make a profit. In their place, it is estimated Facebook and Google now pick up 80% of the advertising dollar in this country but they pay negligible tax.

Globalisation and the internet are similarly challenging Australia’s revenue base in retail, financial services and other sectors. Paypal, for instance, eBay’s corporate cousin, paid more than $1 billion of its $1.2 billion in revenues to its parent and associates in Singapore over the nine years to 2014 thanks to a “service agreement”.

Looking at the accounts, thanks to the new tax law, revenue rose from $498 million to $1.14 billion. Sales and marketing expenses, however, recognised for the first time at $324 million, knocked profits about. Profit rose from $50 million to $121 million on which tax expense was $16 million, up from $3 million.

Actual tax paid as per the cash-flow statement was $41 million, up from $16 million. So, like Apple, Google is beginning to pay significant amounts of tax, although still way short of the mark, and it appears to have bloated its cost base here as much as humanly possible. Assuming group sales are heading towards $3 billion (Google booked $882 million in advertising revenue), the real income tax number ought to have nine digits.

For its part, Facebook booked revenue of $327 million, ten times the $33.5 million recorded in the the previous year. After forking out $271 million to related parties for the “purchase of advertising inventory”, it made a profit of just $6.3 million on which it paid $3.4 million in tax.

Under its previous structure, Facebook sales were booked to an associate in Ireland. For the purposes of reporting as little as possible, the company even won an exemption from the corporate regulator when it claimed to be a “Small Pty Company Controlled By a Foreign Coy Which is Not Part of Large Group”. That its foreign parent was valued at more than $170 billion on Wall Street didn’t seem to matter.

Now, Facebook has declared itself to be a reseller of local advertising inventory. Both Google and Facebook are audited by EY.

None of these companies operate to maximise profits for the benefit of their Australian entities. All have small, token boards of directors. All operate in the interests of their foreign overlords and should be taxed as agencies.

It is a good thing the authorities are catching up with multinational tax lurks. This would not have occurred without public outrage and dissent. Nor would it have occurred without the Senate Inquiry into Corporate Tax Avoidance in 2015, which thrust the issues into public view. They should keep this Senate committee rolling with biannual investigations where corporate leaders are held to account and subject to full public scrutiny. After all, directors have a fiduciary duty to perform in the interests of their companies, not some tax officer in California.

Further, the architects of multinational tax avoidance – EY, Deloitte, PwC and KPMG – ought to be subject to greater disclosure requirements rather than operating as murky partnerships whose partners pontificate to government on tax policy while advising their big clients how best not to pay tax, or “leakage” as they call it in the trade.

Michael West, Adjunct Associate Professor, School of Social and Political Sciences, University of Sydney

This article was originally published on The Conversation. Read the original article.

See Google’s Absolutely Stunning New Headquarters Design


TIME

Google has unveiled its ambitious new plans for a sprawling, modern Googleplex. The new facility, being developed by architect Bjarke Ingels, features a series of glass, canopies the size of city blocks, new biking and walking paths and an emphasis on green space. Renowned designer Thomas Heatherwick is also involved in the project. Google hopes to complete the first stage of development by 2020, but the company will first have to win approval from Mountain View’s city council amid growing concern over Google’s control over the development of the community.

[time-brightcove videoid= 4084569777001]

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Check your Google security settings, receive 2GB of free Drive storage


Gigaom

Here’s an easy way to get 2GB of Google Drive storage: In the next week, head to Google’s security checkup page and follow the instructions. On February 28, Google will credit your account with the additional cloud storage space. The security checkup takes less than 5 minutes to complete, and it’s simple — it asks you what your backup email address is, whether any recent account activity is odd, and to review the various apps you’ve given Google account permissions to (there are probably a lot.) Sure, 2GB of additional Google Drive space isn’t a ton (you get 15GB for free), but you probably should review your security settings anyway.

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