Just like Craigslist devastated local classified advertising in newspapers, Google has also chipped away large chunks of advertising revenue from newspapers by ‘copying’ original content from newspaper articles and displaying it in their search results without compensating the newspapers and original content creators!
“Simply put, Google has not done enough to aid the newspaper industry. If the company continues their profiteering ways at the expense of original content creators, more papers will fold and less content will be created.” – Michael Kozlowski
Actually that first sentence in the quote above SHOULD read that Google has not justifiably compensated news sources for using their content. It has nothing to do with ‘aiding’. Newspaper content, if it is not already, should be considered copyrighted material with agreements for ‘fair use’ by the usual players — BUT, I don’t consider Google (or any other internet behemoths) using the work of others to make large advertising profits for themselves, at the expense of the original content creators and without proper compensation, a case of ‘fair use’.
Google apparently has woken up a little (with prodding) and has entered into commercial agreements to establish a €60m digital innovation fund that will help local news companies start to monetize their newspapers in digital form. This will allow media organizations to profit from Google advertizing platforms such as AdSense and AdMob for mobile phones.
Has Google Demolished the Newspaper Industry?
There has been quite a number of journalists weighing in on the role Google plays in the newspaper industry. The company has made billions of dollars of advertising revenue at the expense of content creators. The newspaper industry has lost billions of dollars in the last 10 years, which is directly proportionate to the sheer growth Google has garnered . Should Google be doing more for the newspaper industry?
In 2011 Google made 37.9 billion dollars, of which 96% derived from advertising. Each quarter from 2012 to 2013 earned Google 14 billion dollars on average with the same amount coming from their core advertising market. “Our top 25 advertisers are spending over $150 million per year” on Google’s ads business such as search, display and YouTube, said a Google Spokesman . Currently Google accounts for more than 41% of U.S. digital ad revenues, according to eMarketer.
When Google first introduced their Adwords platform in the year 2000, newspapers in the US peaked at $48 billion dollars from direct advertising. This has since declined to 18.9 billion in 2012. It is painfully obvious that most advertisers are getting more bang for their buck by advertising on the internet, instead of physical papers.
In the last few months many of techs leading innovators is trying to help journalism reach new heights and put a priority in the dailies. Amazon CEO Jeff Bezos acquired the Washington Post for $250 million, then eBay founder Pierre Omidyar promised to spend a similar amount on a brand-new media entity called First Look Media. Google so far as done nothing to give back to the industry.
Many European countries are not taking the advertising market share of Google laying down. Google generates an estimated €1.5 billion, or $2 billion, in France. The government is irate that the company pays almost no taxes in France, and instead is going to Belgium and Ireland. “We want to work to ensure that Europe is not a tax haven for a certain number of Internet giants,” the digital economy minister, Fleur Pellerin mentioned.
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