This is an excerpt from a story delivered exclusively to Business Insider Intelligence Digital Media Briefing subscribers.The News Media Alliance (NMA), which represents 2,000 news publishers,determined thatGoogle made $4.7 billion in revenue from news content in 2018, per The New York Times . By comparison, the news industry as a whole generated $5.1 billion total in digital advertising revenue in 2018.
This revelation could make the Journalism Competition and Preservation Act more likely to pass, an act that would enable publishers to collectively bargain for revenue sharing with platforms.More concrete numerical representation of Google’s dominance could bolster the case for greater news industry protections.
The proposed bill, which I covered in April, would allow a 48-month suspension of antitrust blocks on publishers that want to collaborate in order to negotiate better terms with duopoly. The latest version of that bill will be presented today at the first in a series of House hearings about tech dominance and how the playing field might be evened between publishers and platforms.
David Chavern, the CEO of NMA, told CNN Business that “what [they’re] looking for is the ability for news publishers to act collectively to bargain for a better, more sustainable arrangementbecause the platforms now take advantage of all our content and return very little of the money back to sustain the future of journalism.”
If enacted, this legislation could serve as a test run for a longer term solution to the news industry’s duopoly-inflicted woes one that would be beneficial for both parties.Legislators on both sides of the aisle are acknowledging that publishers can’t truly compete with tech companies’ ad capabilities. Smaller publishers and local news are increasingly shuttering or downsizing as ad dollars are siphoned by Google and Facebook.
As such, the situation is unique, in that lifting antitrust regulations would benefit a group struggling to compete. And publishers aren’t the only ones with something to gain: Google made that $4.7 billion because publisher content exists, and about 40% of the clicks on Google’s trending searches are on news content, per the NMA.
While publishers are pushing the act so they can negotiate revenue sharing deals with dominant platforms, the bill could spark further collaboration if it passes here are two ways that could look:
- Publisher alliances. A model for such alliances could come from Germany, where the country’s four largest publishers banded together to fight the duopoly directly for ad dollars rather than negotiate revenue splits. Together, they’re offering joint prolonged advertising contracts across their sites to try andlock in advertising commitments.
- Mergers. With eased antitrust regulation, publishers could attempt to merge directly. There have been calls forlarge-scale combinations this year most prominently, BuzzFeed chief Jonah Perreti highlighted consolidation as a potential strategy to take on the duopoly. However, even amidst chatter between the likes of Refinery29 and Group Nine Media, for instance, we’ve seen little in the way of concrete action.
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