Prime Minister Scott Morrison has offered hope Google will remain in Australia after holding “constructive” talks with the tech giant’s CEO this morning.

Mr Morrison and Communications Minister Paul Fletcher spoke to Google chief executive officer Sundar Pichai on Thursday morning to discuss the government’s media bargaining code.

The proposal has been met with fierce resistance from Google, which threatened to prevent Australian users from accessing its search engine last month.

Despite the threat, the federal government has pushed ahead with its plan to make big tech giants, including Google and Facebook, pay for Australian outlets for news content.

But Mr Morrison claimed after Thursday’s “constructive” conversation, he was more optimistic about Google remaining in Australia.

“I have been able to send them the best possible signals that should give them a great encouragement to engage with the process and see them conclude with the various news organisations,” he told reporters on Thursday.

“That is the best way to enable that matter to be settled.

“We discussed some of the specifics of elements of the code. They raised those matters, I think, very respectfully.

“I think we have been able to get that into a much more positive space about the ability to continue to provide services here in Australia.”

But Mr Morrison said he had made clear Australia would not kowtow to demands from the tech giant.

“At the end of the day, they understand that Australia sets the rules for how these things operate. And I was very clear about how I saw this playing out,” he said.

The government was buoyed on Wednesday by Microsoft publicly backing the code.

The US software giant claimed it would step into the void left if Google carried out its threat, saying its own search engine, Bing, could replace it.

Microsoft president Brad Smith claimed it would “take us a few months, but not years” to get up to speed in Australia.

“We know that we can invest in a way that will bring Bing and its search quality and its services for businesses on a par with what people get from Google today,” he said.

“We will need to invest, and we will. It will take us a few months, but not years. It will not be a small investment.

“We’ll take it one step at a time before we start talking publicly about numbers.”

Google and Facebook have declared the code unworkable, and launched a PR campaign in a bid to scupper it.

Facebook founder Mark Zuckerberg lobbied Treasurer Josh Frydenberg and Communications Minister Paul Fletcher directly, but was unsuccessful.

Facebook has also reiterated a threat to prevent Australians from accessing or posting news content on its platform.

Along with its threat to leave the Australian market, Google directed Australian users of its search engine to a video of Australia and NZ managing director Mel Silva declaring the laws would “break” Google’s model.

The link has since been removed.

The tech giant also temporarily hid certain news sites from some Australian users in what Ms Silva described as an “experiment” that had been “forced upon us” by the government.

The Australian Institute Centre for Responsible Technology director Peter Lewis told a senate committee on Monday “Chairman Mao would have approved” of the tactics used by Google, which was prepared to “kill one to warn a hundred”.

The threats prompted Greens leader Adam Bandt to call on Wednesday for a publicly owned search engine.

“Google has enormous market power and they’re using it to threaten the Australian parliament and the Australian public,” he said.

“It’s time to seriously consider what a replacement would be.”

About 95 per cent of online searches in Australia are conducted via Google.