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Google to pay for stories in News Corp deal

Google and Rupert Murdoch’s News Corp have ceased hostilities with a three-year deal

Google and Rupert Murdoch’s News Corp have ceased hostilities with a three-year deal that will oblige the ubiquitous search engine to pay for journalism carried on sites such as the Wall Street Journal, The Times and The Australian.

Both parties will also develop a subscription platform, cultivate audio and video journalism and share ad revenue.

What does the deal mean?

  • The agreement ends a protracted stalemate between Google and Australia, which have been engaged in a war of words over the search giant’s failure to compensate publishers, most notably News Corp, for use of their stories.

  • Having conceded the issue, Google will now stump up to display premium content from over 40 News Corp properties in a dedicated Google News Showcase, including The Wall Street Journal in the US, The Times in the UK and Sky News in Australia itself.

  • The expansive deal also includes similar multi-million dollar deals with smaller Australian publishers including Seven West, Nine Entertainment and Junkee Media.

Why does it matter?

  • The agreement signals that Google has conceded the broader principles in the argument, opening the floodgates to a raft of similar deals internationally – including similar deals with French publishers which recently concluded.

  • In return, Google has staved off the immediate threat of regulation but the longer-term implications for both the internet giant and news industry remains less clear.

  • Welcoming the agreement, News Corp chief executive Robert Thomson, the chief executive of News Corp, said it would have “a positive impact on journalism around the globe as we have firmly established that there should be a premium for premium journalism.“

  • Others are less sanguine with some media watchdogs warning that the partnership will merely further entrench Google and Facebook’s outsized clout in media with publishers as the subservient parties.

  • For its part Facebook has shown itself to be less acquiescent, ratcheting up the stakes in its battle with the Australian state by restricting the dissemination of news on its platform within the country.

  • Facebook’s aggressive stance illustrates the depth of opposition it holds, shared by Google, against a proposed law (backed by News Corp) that would force tech giants to pay publishers for the traffic their stories draw.

  • Google has not ruled out the nuclear option of pulling the plug on its search functionality in Australia if the proposed law ever comes to pass.