How is Google’s plan to pay for news shaping up?

THE INTERNET giant Google wants to choose what news organisations it pays - to fend off a European Union law that demands that it pay all news providers. The Press Gazette has been looking into its "Google News Showcase" plan: "Google News Shh-owcase: Publishers break silence over secret deals behind $1bn scheme"

18 October 2021

Google News Showcase UK screenshot

The top of Google News Showcase UK at 14:00 on 18 October 2021

As the Press Gazette notes, the agreements between Google and publishers include "strict confidentiality clauses". William Turville spoke - in confidence - with "more than a dozen senior publishing industry sources across five countries". One noted that "Nobody knows how much anybody else is being paid." This clearly puts them at a disadvantage in negotiations with the internet giant. As William writes: "In 2020, as the advertising slowdown forced many news companies to make large cutbacks, Google and Facebook's dominance of the market kept growing (to a combined share of 35 per cent of all global advertising according to GroupM)."

The reports that William gathered suggest that publishers in Australia are receiving better deals than those in other countries: more than US$100 million a year. Probably half of that goes to Rupert Murdoch's operations. These deals followed the Australian government's announcement of a proposed law compelling Google to pay newspapers for all content - and Google's threat to withdraw all search services from the country. As the Freelance noted at the time, this echoed its response to a Spanish law compelling it to pay - is still down - and looked "like another example of an internet giant insisting that it will pay who it chooses, how it chooses".

Google News Showcase launched in the UK on 10 February 2021. William Turville reports that "One source at a UK publication that has not signed up to News Showcase said many British publishers have accepted offers simply because they need the money at a tough time for the industry.... The working estimation of one British newsgroup is that Google has set aside a budget of around £30 million [US$41 million] a year for News Showcase and related payments in the UK."

In joined-up Europe, Google also seeks to avoid being compelled to pay publishers by law - in this case the Directive on copyright and related rights in the Digital Single Market. William quotes a Reuters report on 12 February that French publishers "were being paid $22m annually for licensing deals and an extra $10m in exchange for not suing Google over copyright for three years". In July the French competition court imposed a $500 million fine on Google for failing to negotiate with publishers under the terms of the country's implementation of the Directive: Google is appealing.

In Germany, the competition authority launched an investigation on similar grounds on 4 June. Its President, Andreas Mundt, noted that deals with Google must not "result in discrimination between individual publishers". A "well-placed market source" told William that Germany's largest publications have agreed such individual deals "worth €1 to €4 million [US$1.2 to 4.6 million] a year, roughly in line with figures from France." The Axel Springer company is holding out.

No deals have been announced in the US, where the Journalism Competition and Preservation Act of 2021 is (confusingly) a Bill before Congress that would allow publishers to band together to negotiate with Google, Facebook and so on. A source at a major US publishing company told William that it "doesn't really feel like" Google is trying to pay us off: the company's offers "are not payoff sums, in my view".