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June 25, 2020, 2:52 p.m.

“Google paying publishers” is more about PR than the needs of the news industry

Google and Facebook are happy to pay for news — as long as it’s on their terms.

Mountain View got the headline it wanted: “Google will start paying publishers for news.”

Just like Menlo Park got the headline it wanted a few months ago: “Facebook Offers News Outlets Millions of Dollars a Year to License Content.”

There are lots of ways to look at how the duopoly looks at its relationship with the news industry — as generous corporate citizens who care about the information environment, say, or as a pillaging cartel ruining society by vacuuming ad dollars.

But the correct way to view Google and Facebook’s actions, I believe, is through the lens of PR. The troubles of the news business are a major PR problem for these companies, who — however fair they or anyone else thinks it is — get blamed for its ills. The right way to understand the actions they take is by asking how they do or don’t address that problem.

And from that perspective, those headlines are the real wins.

The next time one of their executives gets dragged to D.C., he can go beyond platitudes about democracy and trying to explain the value of traffic to congressmen who can’t figure out their smartphones. He can say: “Actually, we do pay news publishers for their work — many millions of dollars every year.” It’s a good line!

Think about it. Both Google and Facebook have a lot of news in their products — in search, in the News Feed. But they have a lot more stuff that isn’t news. And they make a much, much, much larger share of their money from all that other stuff.

Searches for “city council meeting last night” and “what’s happening in syria” are much less common — and much less remunerative — than searches for “best compact suv” and “cure for balding.” Google, pushing back against Australia’s attempt to force it to hand over cash to news companies, said “news-related queries accounted for just over 1 percent of total queries on Google Search in Australia.” Even if you think Google is defining “news-related queries” too narrowly, it’s not a big number.

Meanwhile, when Facebook cut back on how much news hits the News Feed in January 2018, they reduced it from a whopping 5 percent of total content…to 4 percent.

From the duopoly’s perspective, the biggest problem with paying for all the news coursing through their digital veins isn’t the money. (They have plenty of money.) It’s that paying for news in any systemic way would attack their core advantage as platforms: organizing other people’s content.

Say you think Google owes The New York Times money for including all of its news stories in search. Fine. Do they also owe me money for including my old blog from the early 2000s? It’s in Google’s index too. How about Breitbart? How about The Daily Stormer or Stormfront? What about your tweets? DairyQueen.com? All of them are digital content that contribute some sort of notional value to Google as a product. Maybe you think you can draw the line somewhere, but where — and how do you apply it to an index of billions of websites?

Should Facebook pay publishers based on how much value they add to News Feed? Okay — then the biggest check goes to the Daily Mail, and The Daily Wire gets as much as The New York Times.

No, any sort of systematic, performance-driven payments to publishers based on the value they offer platforms are a no-go. So Facebook and Google have responded by looking for other ways to deal with the PR headache by getting money to news companies.

The first wave was all about giving grants. Google started the Digital News Initiative in 2015 to fund innovation projects at European publishers — or, more accurately, to stave off regulation by European countries. That eventually spread to other parts of the world where legislators were making angry noises in Google’s general direction. Facebook, playing PR catch-up after Donald Trump’s election, answered with its own Facebook Journalism Project in January 2017.

Both of these projects have given many millions of dollars to news publishers around the world. The people who work on them earnestly support the cause of journalism and want to help. But they’ve also done very little to meaningfully change the news industry’s core financial crisis. Publishers’ problems are not, generally speaking, the kind of thing that can be fixed with one-time grants for innovation projects. The core crisis is that the internet fundamentally changed the ways audiences and advertisers get things done — in ways that hurt expensive-to-produce journalism and helped a few globe-bestriding tech giants like Google and Facebook.

So last year began the second wave — and this time it was Facebook who took the lead. It started making deals with individual publishers for their stories to appear in a brand new Facebook News Tab, to be curated by Facebook editors. Some news outlets would reportedly get as much as $3 million a year.

This is so much better from Facebook’s perspective, for two big reasons. First, it can pick whatever publishers it wants to give money to. (Facebook is paying some of the publications in the News Tab, but only some — most get zip.) And second, it’s money for a new tab buried so deep in Facebook’s interface you need a spelunker’s headlamp to find it — not for the part of Facebook that people use and publishers feel abused by, News Feed.

From a legal perspective, it’s entirely unclear why Facebook is paying any of these publishers. Open up your Facebook News Tab, if you can find it, and tap on a story — it’s just a link to the publication’s website, opening in a browser. (Or in an Instant Article, if a publisher is already using it.) You don’t need to pay a site to link to one of its news stories; after all, Facebook isn’t paying most of the publishers in the News Tab, and it doesn’t pay publishers for any of the links in News Feed.

So why is Facebook doing it? Because this lets them (1) pick the publishers they want to pay, (2) pick the amount of money they want to pay them, (3) get publishers to stop complaining, at least hopefully, and (4) get headlines like “Facebook Offers News Outlets Millions of Dollars a Year,” in the hopes that they can stave off government regulation or taxation.

Facebook’s not spending who-knows-how-many millions of dollars a year because they think News Tab will be profitable to the bottom line. It’s a way to solve a PR and policy problem. Mark Zuckerberg even helpfully urged other tech companies to follow his lead.

And now we have Google moving in the same direction. From Ben Mullin’s Wall Street Journal story:

Alphabet Inc.’s Google said it has reached agreements with selected publishers around the world to license news content, a significant development in the yearslong tug of war between the tech giant and media companies.

Google said the initial participants include Germany’s Spiegel Group, publisher of Der Spiegel; Brazilian media company Diarios Associados; and Solstice Media, the publisher of local newspapers in Australia.

[…]

[Google VP Brad Bender] declined to provide financial details on the latest licensing deals, saying they vary depending on how much and what type of content each publisher is providing to Google.

Google is paying the news organizations to license audio, video, images and stories that will be featured on Google’s primary mobile app and on mobile devices using the Android operating system, accessible with a swipe on the homescreen. The licensed content will also be built into the Google News app for every mobile device, and the company hopes to eventually make it available on other Google products. Google aims to launch the product later this year, Mr. Bender said.

Note the similarities with Facebook’s News Tab. Google picks what publishers it wants to deal with and how much to offer them. It’s for a Google side product, not the big kahuna of search.

And, as with News Tab, it’s not even clear that Google has to pay for the content. Google already has a Google News app, after all, and it’s already full of links to news stories that open in a browser. Google doesn’t pay the publishers who produce all those stories, and they’re not about to start paying them. They’ll pick and choose.

(Presumably Google will be able to build these newly licensed stories more directly into the app, probably via AMP, rather than have them open in a browser. But that’s a technical detail.)

Google also already has a stream of news for “mobile devices using the Android operating system, accessible with a swipe on the homescreen.” It debuted way back in 2012 as Google Now, then became Google Feed, and is now Google Discover. It already features lots of news stories for which Google pays zero dollars.

And come on, look at where Google is doing these deals. Germany, which has been trying to get Google to pay for a decade and is trying again. And Australia, which recently announced a “mandatory code of conduct” that would force Google to pay for Australian news. And Brazil, which has its own history here.

If I were a publisher and Google and Facebook wanted to write me a check to do nothing other than keep publishing, I’d be very happy to cash it. But this second wave of plans is — just like the first wave was — more about solving the company’s problems than anyone else’s.

POSTED     June 25, 2020, 2:52 p.m.
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