Bill Would Force Google to Share 7% of Israeli Revenues With Websites

The company’s concentration of economic power comes at the expense of Israel’s creativity, a Knesset member says.

Google and other search-engine companies will have to set aside 7% of their Israeli revenues for local content providers, according to a new bill designed to help break up the country's concentrated economy.

The bill, proposed Wednesday by MK Erel Margalit (Labor), would create a special committee and nonprofit company to collect the money from the firms and distribute it. Margalit singled out Google, the largest company in the sector.

"Google's concentration [of economic power] comes at the expense of Israeli creativity," said Margalit. "While the media are weakening, search engines are getting stronger and becoming the indisputable sheriff of content management and navigation on the Web …. The revenues from content and production must be split among their owners and not accumulate in the hands of one large body."

According to Margalit, “If we don’t pass the law now, Israel’s free press will be severely hampered; remaining will be newspapers controlled by wealthy men, with the newspapers doing their bidding."

A Google spokesman, however, told TheMarker: "Innovation and commercial cooperation is a better way forward than new legislation in order to ensure that the content industry thrives online. Google works closely with publishers to develop new technology to increase news publishers' audiences, revenue, and engagement on their sites, and we will continue doing so."

Google Israel’s revenues are not published, but analysts put them at between NIS 400 million and 500 million annually - and they are believed to be growing fast.

Google has not yet agreed to such revenue participation anywhere in the world, but in France the company established a 60-million-euro fund to help the French press transition to digital operations. This followed intense pressure from the French government.

To be protected by the Israeli law, websites would have to be updated with new material every week, and 30% of their content would have to be produced by employees or freelancers, not users.

According to the bill, the committee would be led by a retired judge and include officials from the ministries of culture, finance, justice and communications. The search engines would have to hand over the 7% by June 1 every year.

Eyal Toueg