Yes Google has to do a ban now otherwise they look like paper tigers. That said it won't last as Australia's still a profitable market and Google certainly doesn't want to encourage others to challenge their monopoly anywhere.
I don't think that Australia is more than 2% of Googles revenue, USA tend to be over represented in revenue. I don't think 2% is worth giving in for, I mean they even refused to enter China which is a much bigger market.
