Google Is Making Billions at the Media's Expense

Last year, amid a wave of layoffs and turmoil in the media that has shown no sign of breaking, Google earned $4.7 billion in revenue from news publishers through search and Google News—a figure that is likely conservative due to the multinational’s diverse business model. The findings were part of a study by the trade organization News Media Alliance, previously the Newspaper Association of America, and first reported in The New York Times.

“The actual value of news content to Google is more difficult to quantify because of the various ways the company uses news content to drive traffic, develop its products and entrench its dominant position,” the study reads. “In addition to using news content for product development, such as training its artificial intelligence services, Google is tailoring its products—ramping up its use of news—to keep users in the Google ecosystem.”

For a news industry that earned a total $5.1 billion in advertising in 2018, the dangers are manifest. Just ask Philadelphia Media Network CEO Terrance C.Z. Egger, whose company’s publications include The Philadelphia Inquirer, Philadelphia Daily News and the erstwhile philly.com. “The study blatantly illustrates what we all know so clearly and so painfully,” Egger told the Times’ Marc Tracy. “The current dynamics in the relationships between the platforms and our industry are devastating.”

David Chavern, the News Media Alliance’s president and chief executive, offered a similar assessment: “[Google] makes money off this arrangement and there needs to be a better outcome for news publishers.”

Chavern hopes this latest study will impel Congress to pass the Journalism Competition and Preservation Act, a bill sponsored by House Antitrust Subcommittee Chairman David Cicilline, D-R.I., and House Judiciary ranking member Doug Collins, R-Ga. According to the alliance, the legislation would “grant news publishers an antitrust safe harbor allowing them to come together to collectively negotiate with the tech platforms for more equitable terms.” The bill, which has the backing of the American Society of News Editors (ASNE), National Newspaper Association (NNA), Association of Alternative Newsmedia (AAN) and dozens of state press associations, would allow also publishers to “withhold content during the negotiations.”

Google’s hefty profits at the news industry’s expense will likely renew calls in progressive circles to smash Big Tech. Sen. Bernie Sanders, I-Vt., has called for Facebook to be broken up, while Sen. Elizabeth Warren, D-Mass., introduced a proposal in March that would dismantle several Silicon Valley monopolies, including Google. “We must help America’s content creators — from local newspapers and national magazines to comedians and musicians — keep more of the value their content generates, rather than seeing it scooped up by companies like Google and Facebook,” she wrote at the time.

As the News Media Alliance makes clear, the future of the Fourth Estate may depend on it.