In a clash that echoes the struggle between the music industry and online streaming services, publishers now want greater levels of remuneration for their journalism from websites, aggregators and apps displaying their stories or linking to them.
Journalism has traditionally been financed through advertising, but this has been eroded by Facebook and Google’s dominance in digital advertising. Publishers argue that because their own content, as headlines, snippets or pictures, is served up to social media and search users, they deserve a fairer share of these revenues.
The situation is now so tricky that government intervention is being considered. In Australia, the News Media Bargaining Code was drafted and introduced in parliament with Google Australia and New Zealand vice president Melanie Silva concerned it would “significantly impact the Google services Australians use every day”.
Writing on Google’s blog, she says: “An overwhelming majority have concerns about key aspects of the code or are downright opposed to it. Even a number of news publishers have voiced concerns about key aspects of the draft law, such as the arbitration process and minimum standards provisions, and its impact on media diversity.”
In France, Google is paying some media outlets for content appearing in searches, while late last year it announced a $1-billion global investment in partnerships with news publishers to include its forthcoming Google News Showcase.
According to Google and Alphabet chief executive Sundar Pichai: “This financial commitment, our biggest to date, will pay publishers to create and curate high-quality content for a different kind of online news experience.”
Facebook too has agreed to pay UK publishers for “content that is not already on the platform” amid the launch of Facebook News. Media names including Hearst, Condé Nast and Reach had all signed up, Facebook says.
UK is also looking at media IP intervention
To tackle the growing issue, the UK government announced in November 2020 that a new Digital Markets Unit, created through the Department for Digital, Culture, Media and Sport and the Department for Business, is to launch.
Its job will be to introduce and enforce a new code that, among other things, will “support the sustainability of the news publishing industry, helping to rebalance the relationship between publishers and online platforms”.
Korieh Duodu, senior partner of Egality Law, a UK firm specialising in media and IP law, says: “It is encouraging to see the UK Competition and Markets Authority dedicate a team to addressing Facebook and Google’s market dominance.
“While the details of the team’s new code are yet to be published, we understand it will help publishers monetise their content. Certain larger publishers are already in talks with Facebook over licensing deals.
“Effective regulation in this area should come as welcome news for publishers and, in turn, facilitate the protection of quality journalism in this country.”
Duodu says it is important the code gives “due regard” to freelance and employed journalists who originate such material, adding: “Freelancers in particular have borne the brunt of a failed regime that doesn’t pay them onward royalties for their syndicated content.”
However, marketing and PR specialist Stephen Waddington, of Wadds Inc., sees state intervention to redress the balance as “a sticking plaster”. “Facebook and Google account for more than 60 per cent of digital advertising spending worldwide. No other platform can offer the audience scale or granularity of targeting,” he says.
“A break-up of big tech is critical to allow the media and technology market the breathing space to innovate.”
Value of news media IP is changing fast
Such innovation will be critical to monetising the IP of news publishing. One way of protecting it has been the idea of a “Spotify” for editorial content with a subscription service to a range of publishers or introducing a micro-transactions system so IP can be paid for on an article-by-article basis.
But while Oliver Feldwick, head of innovation at The&Partnership, one of the world’s fastest growing marketing networks, believes such ideas are possible on paper, he argues people’s appetite for paying for news has been eroded by years of free content.
Alongside this, another key challenge has been the coronavirus pandemic. According to Andy Barr, chief executive of 10 Yetis Digital, it has forced many publishers into greater use of affiliate marketing platforms because traditional advertising revenues and print circulations have dropped.
Feldwick though believes we are set to see an even greater shift in attitudes when it comes to the value of news IP. “Chasing eyeballs led to a boom in clickbait, in outrage, in fake news; whatever gets clicked gets paid,” he says.
“However, now the dust has settled, there is a shift to focus on true, valuable and quality attention. This means quality content and IP is more important than ever. Attention studies show people read ads better on quality publisher sites.”
Highlighting how a mix of payment models, part advertising, part subscription, part bundle, was the likeliest way forward, he adds: “The free content publishers have struggled, while quality publishers who have defended their IP, while pivoting to digital, are seeing a thriving light at the end of the tunnel.”
One further answer to the news IP challenge, says Peo Persson, co-founder of DanAds, is greater transparency, with publishers moving away from intermediaries eating up much of the ad spend to direct booking.
“News publishers have long been under financial pressure, but we are starting to see clear and positive signs journalists and publishers can be rewarded for quality content by harnessing technology to their advantage,” Persson concludes.