Study finds Google makes billions from news

Marco Green
Июня 12, 2019

"The public should be aware of Big Tech's death grip on publishers and the power they have over the online marketplace", they added. That's how much Google earned from its news service Google News past year, says a study. But one relatively recent arrival in the business had a banner year: According to a report from the News Media Alliance, Google nearly matched the industry's total digital-ad revenue with $4.7 billion brought in through search and Google News. The study ignores the value Google provides.

"Today, the vast majority of Americans consume the news online, and two online platforms have enormous control over how Americans access their news sources", Nadler said.

Many publishers have experimented with adding video content to drive ad revenue, but that has been an inconsistent bet, at best.

"The study blatantly illustrates what we all know so clearly and so painfully", said Terrance C Z Egger, the chief executive of Philadelphia Inquirer PBC, which publishes The Philadelphia Inquirer, The Philadelphia Daily News and philly.com. Indeed, the report argues, with consumers' shift toward Google for news consumption, news is becoming increasingly important to Google to keep consumers within its digital domain. The study conducted by the News Media Alliance, which represents more than 2,000 newspapers and websites across the USA, shows that Google makes money from content that it does not even make. "And when that happens, we're stripped of a large portion of advertising revenue".

Between 2007 and 2017, newspapers' ad revenue shrank from $45 billion to $16 billion a year, while ad revenue for Google increased sixfold, from just under $9 billion to $52 billion, according to prepared testimony from the alliance.

Chavern will present the news media's case for a more equitable distribution of revenue before a congressional anti-trust subcommittee tomorrow, which is looking at the relationship between big tech companies and the media.

The alliance noted that its estimation is a conservative one, "as it does not include the value of personal data that Alphabet, Google's parent company, gathers when users click on news articles". "The group arrives at its headline figure with little more than a back of the envelope scribble based mostly on a number one-time Google exec Marissa Mayer mentioned offhandedly during a lunch in 2008", writes Slate reporter Jordan Weissman. The real numbers are hard to quantify, given several factors, including how the company uses news to drive traffic, develop products and maintain its dominance.

What could the government do?

Chavern said he hoped that an outcome of any conversation generated by the study would be the passage of the Journalism Competition and Preservation Act which would give news publishers a four-year antitrust exemption, allowing them to collectively bargain with the owners of online platforms over revenue splitting. Despite repeat attacks on the press by the president, the bill has bipartisan support in the Senate and House. Book publishers tried mass negotiation with Apple some years ago, only to be met with a price-fixing lawsuit from the U.S. Justice Department. Privacy is a rare issue that concerns both sides of the aisle. Separately, the Justice Department and Federal Trade Commission could bring any number of penalties against tech companies, such as fines, requirements that they drop exclusive contracts or demands that they spin off particular business segments.

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