Google's $160M bid to woo European media

Google's recent announcement of 150 million euros ($162 million) to fund digital newsroom strategies in Europe has media observers seeing this as Google's attempt to play nice. But will media organizations view the gesture as a gift from a 'frenemy'?

Search giant's gift an investment from 'a frenemy' amid EU probe

The Google logo is seen at the Google headquarters in Brussels. Google said in a statement Tuesday it is establishing the $198 million Digital News Initiative together with eight leading publishers, including the Financial Times and the Guardian. (Virginia Mayo/Associated Press)

They quarrel. They keep secrets. And they depend on each other.

At times, the complicated relationship between Google and European news publishers is like a schoolyard feud.

Even the parents have stepped in, in the form of stern European regulators who have accused the U.S. giant of cheating consumers by fudging web searches to favour its own services.

Now, though, Google's recent announcement of 150 million euros ($162 million) to fund digital newsroom strategies in Europe has media observers seeing this as Google's attempt to play nice.

A man reads the front page of Spanish newspaper 'El Pais' at a bar in Pamplona northern Spain. Google closed Google News in Spain in 2014 due to a new Spanish law requiring aggregators to pay if they posted any snippets of Spanish news content. (Alvaro Barrientos/Associated Press)

"For the publishers, they're realizing that fighting Google is not the strategy for success because Google is not going to go away," says Vancouver-based media commentator Alfred Hermida, author of Tell Everyone: Why We Share and Why it Matters, which tracks the evolving digital media landscape.

"Google is what a news audience is using to find information. In some ways, Google is not an enemy [to publishers], and it's not a friend," he says. "It's a frenemy."

News companies have long complained that aggregators like Google News siphon clicks, and therefore potential ad money, from content producers.

But now Google looks like it wants to pour some of this back.

EU pressure

As part of its Digital News Initiative, Google and eight European newspapers, including The Guardian and The Financial Times, announced on Tuesday a partnership "to support quality journalism."

Google announced Tuesday a $162-million partnership with eight major European news organizations to support journalism development initiatives. (CBC)

Journalism training, product development and investment in innovative digital storytelling techniques are among the shared goals.

Noble as that sounds, C.W. Anderson, an associate professor of media studies at New York's City University, takes a more cynical view.

"I think it's obvious Google's under a tremendous amount of pressure from regulators in the European Union, and they're looking to put their best foot forward as a kind of public-relations strategy," Anderson said.

That doesn't necessarily mean the initiative is a bad thing, he added, noting it's always good when serious money is being spent on research in the news.

Even so, Anderson points out that $162 million for journalism development represents a drop in the ocean for a multibillion-dollar firm like Google.

Media ecosystem

As Anderson sees it, some insight into Google's proprietary data or search results "would be even more valuable than money in many ways," though those kinds of trade secrets are highly unlikely to be shared.

I'm sure there's a bit of pride involved in accepting money from the company that has stolen so much of their revenue over the past years.- Tim Currie, University of King's College journalism professor

For his part, Hermida says that Google may not see itself as being in the journalism business, but it is a "gateway" company, even if it doesn't produce anything original.

"A significant portion of people around the world use it to go find news and information, so it's part of the media ecosystem," he says.

At a time when large media organizations like New York's Daily News are losing an estimated $20 million a year, Google's olive branch is nothing to sniff at, says Tim Currie, who teaches online journalism at the University of King's College.

"I'm sure there's a bit of pride involved in accepting money from the company that has stolen so much of their revenue over the past years," Currie said. "But we've moved past that."

Currie pointed to other digital players such as Facebook and Snapchat, which have formed official partnerships with news organizations to host journalism on their platforms.

"Unless news companies have some secret technology up their sleeve, they have to work with these new platforms," he says.

Pride swallowing

According to reports, Carlo D'Asaro Biondo, head of Google's strategic relationships in Europe, was expected to acknowledge that "mistakes" had been made when it came to forming friendly ties with the news industry.

Relations became so fraught last year that Google News shut down in Spain, following the passage of a "Google Tax" law requiring news aggregators to pay up if they showed any content from a Spanish publisher.

Facebook founder Mark Zuckerberg's social media platform was reportedly in talks with major media brands such as The New York Times, National Geographic and BuzzFeed to host content natively inside Facebook. (Reuters, Wikimedia Commons)

The Digital News Initiative is one way to make good, says Toronto-based SEO expert Marc Nashaat.

"While this is certainly a means to help appease some of the tensions, it's also advantageous to Google in the long run," says Nashaat, a marketing manager with an SEO agency.

By providing big-name publishers with the means to create shareable online content with the kind of "social signals" that make the content friendly for search engines, Google — serving as a distribution platform —​ will generate more queries, ad impressions, clicks and revenue for everyone, Nashaat points out.

Anderson believes the partnership can also be viewed as a tacit acknowledgment by news organizations that they are no longer in command of their own fortunes, as was the case only a decade ago.

"I'm sure there is a huge amount of pride- and ego-swallowing on the part of publishers to even take this money," he said.

"At the same time, though, they need the money. It cannot be easy for a news organization to acknowledge their futures are now in the control of companies that don't always think about news in the same ways that they do."


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