Why Google, Facebook must pay for news content worldwide

The shutting down of several newspapers’ print editions amid the coronavirus lockdown has magnified the problem of Google and Facebook snatching up news content from media organisations and making a profit for themselves. A pittance is paid to the publishers through Google’s and Facebook’s advertisements on the internet pages it disseminates.

In fact, after the duopoly of Google and Facebook was established through the years, news organisations were designed to compete with each other to get on Google News’ top results by paying to be displayed prominently. Google also introduced Google amp, whereby the web page would load faster but with a Google dominant url and Google advertisements served together with the content.

Similarly, Facebook forced news websites to simply accept a “revenue-sharing” model where the social media outfit would grab and share news content. The problem was that Facebook will be permitted to post advertisements along with it, a percentage of whose earnings would go directly to the media outfit.

Granted that Google and Facebook give news content legs. They take the story beyond the geographical limits of the newspaper’s reach. But if the disseminator makes nearly all of the profits and shares mere peanuts with the producer of the content, how long will news production survive?

This question had not been seriously asked by news organisations scrambling to handle finding a earnings model on the web in the early 2000s and getting nowhere, and therefore trying to best the other person to obtain additional clicks and shares by paying Google and Facebook. However now with no print advertising in the time of corona to cushion losses from having their content shared around free of charge, governments are stepping in on behalf of news organisations and telling Google and Facebook to play fair, and share.

Recently France, Spain now Australia, have ordered Google and Facebook to pay publishers for news content.

On April 9, it had been reported that France’s competition authority had ordered Google to pay publishers to display snippets on its news, search and discovery pages. It told the internet giant to negotiate payments with news organisations it was leeching content from.

Similarly, the Australian Competition and Consumer Commission said it could release draft rules in late July for Google and Facebook to pay fair compensation for journalistic content siphoned off news media.

The ACCC had attemptedto negotiate a voluntary code where the global giants would agree to pay traditional media for his or her content, AFP reported.

In retaliation to such orders in Spain, Google employed a scorched earth policy and shut its news platform. The aggregator made a decision to employ the arm-twisting move instead of share earnings with news publishers whose considerable investment pays for reporters, editors, graphic designers and others to produce the content.

Facebook too has protested Australia’s orders saying it has already made a USD 100 million investment in the news headlines industry to greatly help new organisations struggling amid the coronavirus crisis. But this attitude of benevolence versus paying what’s fair is exactly the problem.

Facebook and Google produce zero content of their own. They are simply just aggregators. Imagine a scenario where Amazon or Flipkart just picked up products from sellers and manufacturers and paid practically nothing to them. The same model holds best for news too.

News publishers hire journalists, pay for infrastructure and produce news in a readable format with hundreds of crores of rupees of investment. Why has it been okay for Google and Facebook to aggregate and “sell” news thus produced, by gobbling up all advertising revenue for themselves?

Another example from the media world is the utilization of photographs from wire services. Publishers pay the news headlines agencies to use their photographs. But Google and Facebook get to display the images and news stories without the payment either to the agency or to the publisher that pays the wires.

And for how Facebook and Google grade and rank news organisations whose content they use, there are no transparent guidelines. This creates an uneven playing field for publishers trying to compete for speed and depth of stories. Even if a publisher generates a tale first or gets the most insights to provide on a development, Google news displays arguably inferior results of websites that are ranked higher. In sales pitches to publishers, Google and Facebook have promised better visibility for payment. But that’s another matter, to be argued following the platforms first make fair payments for fair work.

Because of this, governments worldwide must follow the European and Australian precedents which may have sought to get rid of the parasitic relationship Google and Facebook have with the news media, and create a fresh symbiotic one.