Nieman Foundation at Harvard
HOME
          
LATEST STORY
Bad news from Mashable, BuzzFeed, and Vice shows times are rough for ad-supported digital media
ABOUT                    SUBSCRIBE
Oct. 23, 2017, 10:52 a.m.
Business Models
LINK: www.ft.com  ➚   |   Posted by: Shan Wang   |   October 23, 2017

Google, an advertising giant, has been making nice with news publishers by developing a series of tools they can use to more precisely attract and target paid subscribers. (It also ended the first-click-free policy this month, allowing subscription-based publishers to choose how many articles to show to readers for free without search-ranking consequence.)

Google’s nice comes at a small business price for any publishers who might want to use the planned subscription tools, but the details are still being ironed out with publishers.

“It will obviously come down to what we think that business relationship should be, but bottom line, I think [revenue sharing] will be exceedingly generous [to news publishers],” Google’s head of news Richard Gingras told the Financial Times on Sunday. “In our ad environment, the rev shares are 70 per cent-plus. The rev shares [for publishers] will be significantly more generous than that.” (Google’s AdSense offers around a 70-30 split for publishers who use it to place ads on their sites.)

Gingras made sure to distinguish Google’s tack from Facebook’s “walled garden” approach, telling the FT that “unlike other participants in the environment, we’re not trying to own the publisher. If there are cases where we do cause the subscription to happen, we don’t want to own the customer. None of this changes the marketplace economics, people will pay for what they value.”

That “other participant in the environment” on Friday formally announced its test of news subscriptions models within its Instant Articles format, through which it won’t take any cut of the revenue from subscription signups (the subscription transaction and payment processing will take place entirely on the publishers’ site). Facebook’s subscription tests are Android-only, as it’s been wrestling with Apple over the past few months over Apple’s default 30 percent cut of “in-app sales,” Recode reported.

Show tags Show comments / Leave a comment
 
Join the 45,000 who get the freshest future-of-journalism news in our daily email.
Bad news from Mashable, BuzzFeed, and Vice shows times are rough for ad-supported digital media
The rapid growth of Google and Facebook continues to take its toll on digital media companies.
Asking members to support its journalism (no prizes, no swag), The Guardian raises more reader revenue than ad dollars
The Guardian revamped its ask and its membership offerings — moving from 12,000 members in the beginning of 2016 to 300,000 today.
Beating the 404 death knell: Singapore news startups struggle to cover costs and find their footing
Political news reporting doesn’t seem to be holding up well as a business in the city-state. And it’s even harder when you’re seen as “alternative” media.