Google and Facebook Begin to Pay for News: Will This Trend Hold?

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Disputes between content and ad-serving platforms — such as Google and Facebook — and various news publishers have been roiling at least since the launch of Google News (Sept 2002) and continue to the present. In view of these issues, as well as potential opportunities, back in August (2020) Google put forward an offer of US$1B across ten years towards paying news publishers for its use of their content. This offer came with strings, however: “Google plans to pay publishers to create and curate content for a new mobile product called Google News Showcase, which will initially go live in Brazil and Germany before it is launched in other countries.” In other words, the offer is to get on board with their new service, and to accept the payments for that.

However, other tidbits picked up in the newstreams indicate that deeper issues persist in this context: In the EU, the Paris Court of Appeal recently confirmed a legal requirement, created under the EU’s recent Directive on Copyright in the Digital Single Market (DSM), for Google to pay French news publishers, and this requirement includes no reference to Google’s “News Showcase.” And, potentially of even greater impact in the long run, “the Australian precedent” — a proposed remuneration arrangement similar to that of the French law — may be catching on in other countries, including Canada.

Facebook, meanwhile, has been verging on the same conclusion, according to reporting in The Verge (I’m a little sorry for that, but not a lot): “Facebook’s News tab officially launched in the US earlier this year. The company says that 95 percent of the traffic publishers have gained through the service has been from new audiences. In August, the company said it was considering expanding the service to more countries including the UK, Germany, France, India, and Brazil in the next ‘six months to a year.’ In its announcement today Facebook says it is in active negotiations to launch the service in France and Germany…”

And, Apple may be next (at least in France).

Once upon a graduate school program, I had a prof who would look up from any research proposal I put in front of him and ask, over the bifocals: So what?, his point being, this may be interesting to you, and has a valid study design, but (in effect) “Why should anyone care about what you are pointing out here?” The so-what on the decline of the ‘printed’ news business is a problem several decades long already: For many, many local newspapers and similar organizations, the bottom fell out of their classifieds and ad revenues long ago, starting with the advent of Craigslist (incorporated 1999). Except for a few of the big, well-known papers, the sector has been in chronic revenue distress for many years, with no real (happy) ending in sight.

My own perspective: I’m a reader, and a student of history, and I see significant social value in well-sourced and reported news. These benefits come about, in large part, by wearing out show leather, and the exercise of effective editorial oversight.  For one thing, if we can’t count on high standards of accuracy, then the whole edifice becomes unreliable and therefore useless except as entertainment. But upholding accuracy – and the other important attributes of quality journalism, such as accountability and impartiality – costs money to maintain. Basically (since economics are real, even in ‘the digital economy ’), reporters need to be paid and otherwise supported, and publishers have businesses to run. Wishing this away with concepts like crowdsourcing the news, or staving off the issue with inordinately rich patrons, only masks the problem.

Part of this money problem is addressed by paid subscriptions, as has been true for hundreds of years. But subscriptions are just on the consumer side of the revenue scale. Google and Facebook and other platforms which aggregate the news, rendering it more discoverable by more readers, may also have an economic role to play in supporting – I mean, paying hard cash for — the news, which they are starting to recognize. That, at least, is the thesis which is currently being tested.

Late-breaking addendum: Google has just released some new details about News Showcase, including the ability for readers to access some articles behind (what would otherwise be) subscription paywalls. That certainly sounds like a consumer benefit.

Dave Davis

Author: Dave Davis

Dave Davis joined CCC in 1994 and currently serves as research analyst. He previously held directorships in both public libraries and corporate libraries and earned joint master’s degrees in Library and Information Sciences and Medieval European History from Catholic University of America. Dave is fascinated by copyright issues, content licensing and data. Also, rock and roll music.

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