Google Is Making Billions Off Journalism as Newsrooms Starve

Last year Google made an astonishing $4.6 billion off the news industry, according to the New York Times. That’s a shocking amount of money, considering the declining state of journalism, and the fact that Google isn’t actually reporting or writing anything itself.

The figure was drawn from a new report by the News Media Alliance, who say the journalism industry deserves to see a cut of those massive earnings.

“They make money off this arrangement and there needs to be a better outcome for news publishers,” David Chavern, the president and CEO of the alliance, told the Times.

The report points out that the entire news industry made $5.1 billion off digital advertising last year, which is only a little more than Google made off that same content. The News Media Alliance believes its estimate of Google’s earnings was conservative, and the real number may be much higher.

“The study blatantly illustrates what we all know so clearly and so painfully,” , Philadelphia Media Network CEO Terrance C.Z. Egger told the Times. “The current dynamics in the relationships between the platforms and our industry are devastating.”

The News Media Alliance hopes their report may influence discussion at a House subcommittee hearing next Tuesday when legislators will discuss the media and tech companies.

The alliance and some of its members are hoping for the passage of a bill known as the Journalism Competition and Preservation Act. According to the Times, the bill would “give news publishers a four-year antitrust exemption, allowing them to collectively bargain with the owners of online platforms over revenue splitting.” The law has bipartisan support in both chambers of Congress.

“News is an important form of content that sustains civic society,” Chavern told the Times. “I think everybody, from readers to writers to politicians, understands that if journalism goes away, that’s a horrible outcome for whether we’re able to sustain the republic.”

As Google and Facebook’s revenue from journalism has skyrocketed, the news industry has cratered. A study in 2018 found that one fifth of local newspapers have closed in the past 15 years, and mass layoffs continue to plague surviving publications. Earlier this year, 2,900 journalists lost their jobs at publications like BuzzFeed, CNN, Vice, Gannet, and McClatchy.

Publishers are hopeful that an altered relationship with tech giants like Google could be good for them.

“There’s the potential for a beautiful codependence,” Egger told the Times. “If you look at the reason they have such high engagement on their platforms, increasingly news is the No. 1 driver. Given that, they wouldn’t want to see news go away. And yet the unintended consequence is we need to share the revenue or get paid for the content that we produce.”

As bleak as this all sounds, one positive trend is the growing unionization of media workplaces. Increased worker organizing could help publications present a united front in their confrontations with these behemoths like Google. Just this weekend, Writers Guild of America East announced that Fast Company has ratified a contract with its new employee union. And last week, Vox’s union was able to secure higher salaries from management after a work stoppage.

Read the rest of the story over at the Times.

Update, 6/10/19, 10:20 a.m.:

A Google spokesperson reached out to Splinter with a comment:

“These back of the envelope calculations are inaccurate as a number of experts are pointing out. The overwhelming number of news queries do not show ads. The study ignores the value Google provides. Every month Google News and Google Search drives over 10 billion clicks to publishers’ websites, which drive subscriptions and significant ad revenue. We’ve worked very hard to be a collaborative and supportive technology and advertising partner to news publishers worldwide.”