Thursday, 7 May 2009

Should Google News pay publishers for their content?

Working for a publisher the discussion has come up on a number of occasions that surely Google should be paying us for the content we provide it via Google News.

Rupert Murdoch had a whinge about it last month:
"Should we be allowing Google to steal our copyrights? If you have a brand like the New York Times or the Wall Street Journal, you don't have to."
While, the managing editor of the Wall Street Journal, Robert Thomson came out with the slightly ridiculous:
"There is no doubt that certain websites are best described as parasites or tech tapeworms in the intestines of the internet."
Both quotes from the BBC article about this subject.

Should Google pay publishers for content? - No

It's right to expect to be paid in some way for content that you have spent time and money to produce.

Maybe when advertising revenues were strong it was something you could afford to ignore but now this source is receding digital needs to step up and produce another channel of profit. However, stating that Google should be the one to provide this revenue is a rather naive argument.

Google has found a way with Google News of taking what is available for FREE on the internet and making money off the back of it - through referrals to the rest of their offerings.
Stack of European newspapers
Off the back of this the main newspapers received a boost in traffic from Google News. When ad budgets were high, all was good. Increased traffic meant increased revenue from cost per impression, cost per click & cost per acquisition advertising business models.

But with no advertising money available thoughts turn back to the evil G. Surely it makes sense that if Google are making money from this content when no one else is then they should share this pot around.

Well no it doesn't, it's a crap argument. The publishers are offering their content for free online, to everyone. You can access the same content via traditional search engines (Google, Yahoo, Live Search) but nobody is asking for cash from referral here.

Until the content is not available for free on the internet, Google are never going to volunteer cash. They'll wait until somebody calls their bluff. If all the main newspapers pulled their feeds from Google News then they might enter into a discussion. This hasn't happened, yet.

Despite this Google still felt it was necessary to bitch back at the publishers claiming,
"[Google] has shared £3.3bn with publishers through ads program AdSense in the last year".
Well good point, but firstly Adsense is opt-in so doesn't apply to all publishers on Google News and secondly by making this statement Google is admitting that they do indeed owe the publishers something, schoolboy error.

How else can publishers make money online? - Subscriptions

Up until very recently most of the big players online were reluctant to broach the other obvious money from content method - paid for content / subscriptions.

The big UK exception to this is the FT, who in 2007 introduced a hybrid system where you could have 30 views per month before having to pay.

Subscription models become more viable with less money from advertising as site traffic and unique users become less important to the bottom line. Quality, uniqueness and diversity of content take over and differentiation from the competition becomes a sales tool for attracting the lucrative subscription market.

With the addition of subscription revenues, less revenue is needed from advertising to meet commercial targets. The lower traffic figures as a result of content gating and its knock on effect on advertising is therefore diluted.

And not to forget, Google News will still index your site (albeit with the 'subscription' tag).

Example Google News result of a subscription only publisher

The future? - Unique online offerings

Gated content is the online equivalent of buying a newspaper. Getting Google to pay you is the online equivalent of getting the newsagent to pay for your newspaper before selling it on.

"Online equivalents" are lazy ways of trying to transform business models to the digital age. In true 1990s buzzword speak it's not thinking outside of the box.

The brands that will prosper online are the ones that start to use the internet for its strengths:
  • Huge audience
  • Extremely fragmented demographics
  • Extremely niche markets available
  • Extremely flexible routes to market
  • Personalisation and tailored news opportunities
  • Portability
  • This list is in no way complete; tell me more in the comments!
Instead of indiscriminately slapping a subscription wall around content, publishers should take a leaf out of Google News' book.

Use your generic consumer focused general news content as a free traffic driver - that's your website's bait. Let anyone view it, pimp it to every news aggregator going and if advertising returns you still have pages with high traffic. It will also keep your website brand out there.

Use this driver to push your paid-for content. Charge for all truly unique content, ie.
  • Areas of news that only you produce and people need - ie. industry focused business news, such as the FT provides
  • Premium reports - a tech magazine could publish SEO guides, link building guides, technical help
  • Customised reports - Repurpose your unique content into bespoke industry reports for companies and charge for it. Ie. Look at where a company has been in your news and help them to create a report of their brand values in their industry.
  • Sponsored content - Do you have a specialist news channel? Offer a sponsorship package where a company could provide content, sponsor competitions and get involved with your readership in a way not possible with banner ads.
  • Apps - With the rise of iPhones & Blackberrys, apps are big business. Create something so unique you can charge.
  • Sell bespoke content creation - Companies like their customers to think they know their markets. As a publisher you are in a unique position to provide your content in formats that companies can align themselves with - i.e. targeted minisites for brand building.
If people really need something and can't go elsewhere they will pay.

Be creative with pricing strategies. Online items can be sold on an ad hoc basis (download this PDF report for £10) or via a number of tiered subscriptions providing varying levels of access to your content (£900 a year for full unlimited access).

Want to know how to make lots more money online (not a spam link!)? Then read this fantastic presentation by faberNovel about Google's business model.

Related posts
Don't let Google boss your website around
Getting more hits from Google News
Google and Max Zorin, Bond baddies set on world domination

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