Under fire from several quarters for an array of accusations ranging from monopolistic practices to the dissemination (and even funding) of fake news, plus questionable measurement procedures, Google is hitting back with both defiant words, as well as financial handouts. The Drum sat down with Madhav Chinnappa, Google’s director of strategic relations, news & publishers, to discuss its two year-old Digital News Initiative.
Arguably the biggest digital media story of 2017 has been the case of brands pulling spend from Google properties following an investigation by The Times of London which contained evidence of branded adverts appearing next to controversial content on its video-sharing site YouTube.
This has prompted a torrent of chest-thumping vitriol from ‘legacy publishers’, namely from The Times' owner itself News Corp, which itself harbors ambitions of launching its own ad network.
The publishers strike back
However, others from the ‘legacy publisher set’ have added volume to this cry, with this week’s appeal from members of The News Media Alliance which lobbied the US Congress to repeal laws that prevent them from collectively negotiating with Google (and Facebook) as they constitute “a de facto duopoly that is vacuuming up all but an ever-decreasing segment of advertising revenue”.
Appealing to the US law making body’s obligation to uphold democracy the trade body, which represents over 2,000 news organizations, maintains that such a repeal will help “secure the long-term availability of local journalism produced by America’s newsrooms.”
Moralising aside, the source of traditional publishers’ umbrage is plain to see - the duopoly is in-effect ‘eating their lunch’ when it comes to ad revenue.
Jason Kint, chief executive of Digital Content Next, a trade organization focused on digital content, recently told The Drum both Facebook and Google were “capturing all the growth” when it comes to digital ad revenue.
With rumors continuing to circulate that Google is planning to introduce an automatic adblocking function into its Chrome web browser (a move likely to further harm the digital ad revenues of publishers), the widespread consternation is easily understood.
Earlier this year, Moody’s Investors Service issued a negative outlook for the US newspaper sector advising that advertising and premium revenues continue to decline faster than publishers can cut costs and boost digital ad sales.
Similarly, during the same month, eMarketer (which itself is owned by Germany-based publisher house Axel Springer) issued a downbeat projection for newspaper ad spend on the opposite side of the Atlantic (see chart).
Bill Fisher, eMarketer analyst wrote: “Consumers, meanwhile, grow evermore frustrated by the perceived intrusion of ads in the digital news content they access, which has fueled a rise in ad blocking behavior. News brands have had to respond in various creative ways in order to monetize their digital products.”
‘Duopoly accusations are not very accurate’
Speaking with The Drum, Madhav Chinnappa, Google’s director of strategic relations, news & publishers (pictured below), voices a spirited defense of Google’s role in the online media space, but agrees that the biggest challenge facing the news industry is monetisation.
“A lot has been written about you know the alleged 'duopoly' and to be frank some of that is actually not very accurate in terms of understanding the different roles in the ecosystem,” he says.
“Google's role in the news ecosystem when you look at the advertising market of display which is the one that is relevant to publishers is we're a supplier.”
It was precisely the publisher monetisation challenges broached by Dennis Publishing’s recent Project Arete that made it a successful application to DNI, according to Chinnappa, pointing out that collaboration between publishers is one of the central tenets of its ethos.
Referencing the DNI Fund event in Amsterdam where applicants discussed their pain-points, he recounts how “the hardest part was getting people just to sit around a table and say actually this is in our mutual best interest to collaborate.”
He points out that competing publishers have to be judicious when to do so, but adds that Project Arete – effectively a co-funded publisher ad network – was an evolution of existing areas of collaboration, for instance where competing publishers share printing presses.
“Project Arete seems to be an evolution of that, let's find the areas where we can collaborate. Let's be clear there are areas that we should compete like hell and I think that's that's a good and healthy thing,” he says. “Advertising trading platforms; that's an area we don’t really need to compete on. I think that's healthy for the adtech market - competition is good.”
'DNI is not a Google proxy'
Chinnappa is keen to underline the DNI Fund's independence from Google.
“We have a project team that operate independently of Google,” he points out, adding Google itself doesn’t choose those it awards funding to.
Rather, recently successful applicants (among them were the recent awards to Al Jazeera, and Wikitribune) were selected by a panel of 12, with Googlers only making up a quarter of this number.
“I recused myself from the Wikitribune one because I'm a personal supporter of both Wikitribune and Wikipedia,” he explains, adding that a mix of industry executives and journalism academics make up the remainder of the pan-European body
'Google didn’t undermine fact-checking’
In an era where the term ‘fake news’ has entered popular parlance, Google has come under pressure for its search engine’s role in aiding the dissemination of inaccurate, or sometimes downright misleading ‘news’, despite its many efforts to discredit such content.
When the issue of fake news and verifying user-generated content is put to Chinnappa, he issues a spirited defense of its actions in the crusade against fake news. “I'm not sure how you see that verifying user generated content is a problem that Google has caused. I see the YouTube problem as two quite separate issues,” he says.
“When I was at the BBC [working in its editorial products] I was one of the people who set up the user generated content hub. Our biggest issue was being spoofed.
“This is about using the smart technology to help with that as well. The director of the news at the time said ‘In the world that we live in now there's always going to be somebody ahead of the BBC because of the story and that's going to be a member of the public’. So we need to figure out how we deal with that today.”
The ‘collaborative content’ model
To this point, he also discusses DNI’s support of Wikitribune, asserting that it and Wikipedia are “absolutely incredible and misunderstood”, pointing out the diligence that goes into its editing and review process, despite its decentralized means of doing so.
The Wikitribune project tries to take some of this spirit of Wikipedia and apply this to news, adds Chinnappa.
He further explains that founder Jimmy Wales' opinion is that the mainstream model of professional online publishing whereby the “journalist writes the article and you’ve got a comment section at the bottom and it's filled with crazy people saying crazy things” is flawed.
“He [Wales] believes that's not a healthy model. What Wikitribune wants to do is actually have a more rounded model where you have the professional journalist and then you have people contributing as well and there's a more open and even dialogue around that,” he adds.
“If it succeeds? I don’t know. But I think it's about enabling experimentation and I think that's going to be a really interesting one.”
The future of tech in the news gathering process
Defending the role of technology in the contemporary news cycle, Chinnappa goes on to articulate his belief that smart technological tools can help verify the veracity of content, and that this is a really big asset to newsrooms anywhere.
“What I take away from the fact checking example is that people knew this was an issue before it was mainstream,” he says.
“Then it becomes a problem and more people jump on it. The fund is a way of surfacing out these these issues before they become either an issue or mainstream. That's always been the spirit of what the fund was about which was really to give people space around this.”
Chinnappa goes on to decry the mass media’s negative focus on the impact of digital media on the traditional values of the news industry. He adds: “But also what are the opportunities?”
The death of the journalist?
He goes on to articulate how it was exactly this ethos that saw DNI award the Press Association over €700,000 for a “robot reporting project” whereby software would effectively carry out the traditional role of journalists.
The initiative, dubbed Reporters and Data and Robots (RADAR), will see a team of five journalists work with Natural Language Generation software to produce over 30,000 pieces of content for local media each month.
Critics have alleged that such measures will potentially will lead to the “replacement of journalists”, ergo offering a further window of opportunity for the proliferation of fake news, etc. But Chinnappa asserts that this is “the evolution of journalism”.
Drawing on his experiences of a news environment, he retorts: “You're a journalist you know what it's like. You have too much information, there is too much out there.”
So if technology can do some of the heavy lifting, then automation can free-up journalists to perform other tasks in their roles, according to Chinnappa, although he notes that there is a balance to be struck.
“That gives the journalists more time to do more added value more in-depth stuff. I think that that's my hope of how news organizations will use this technology and I think the PA is a good example of that,” he adds.
What are the future priorities of DNI?
When quizzed on what the DNI awarding body will be on the lookout for during the next round of funding, Chinnappa is coy, only adding that the future monetization of a thriving news environment is still top of its priorities.
“What I think we're going to be doing in round four is going to have more of an emphasis based on that market feedback around monetization. And let's channel the creativity that way,” he concludes.