A new study from the News Media Alliance is showing just how much money Alphabet’s Google is making from news content. The News Media Alliance, originally known as the Newspaper Association of America (NAA), is a nonprofit organization serving the newspaper industry. The organization was founded in 1992 through a merger of seven associations and currently represents about 2,000 print and online news outlets.
The results of the study showed that news content has produced significant financial returns for Google. It is estimated that Google made $4.7 billion in revenue in 2018 by scraping content from news publishers. Some are saying that this is a conservative estimate, with the actual number likely being much higher. Others are saying the study oversimplifies the financial relationship between tech platforms and publishers.
What is known is that over the past decade, news industry revenue has plunged. According to a Pew Research Center report, news media ad revenue declined by $30 billion between 2006 and 2017, a 54 percent drop. In the past 15 years, nearly 20 percent of all newspapers have closed and tens of thousands of journalists have lost their jobs amid mass layoffs.
Many in the news industry are claiming that Google and other tech giants have robbed the news media of its advertising revenue. News Corp. general counsel David Pitovsky said in a statement that the “free-riding by the dominant online platforms has resulted in a massive siphoning off of profits” from news organizations.
Google and Facebook alone account for about 60 percent of all U.S. digital advertising revenue. A Google spokesperson countered that Google News and Google Search generate clicks for media websites, “which drive subscriptions and significant ad revenue.”
Many in the news business are backing the House’s Journalism Competition and Preservation Act as a potential solution. The act would grant publishers a four-year antitrust exemption to allow them to negotiate together with internet companies. Supporters of the measure say that it would give publishers a voice in how their content generates revenue and how the data collected from readers is controlled. A similar measure is being considered in the Senate.