Is Google’s agreement with French publishers exportable to the U.S.?

You may have missed the news in early February that Google has established a $60 million Euro (about $80 million) fund to support a group of French publishers in their digital enterprises.

Not only that, Google chairman Eric Schmidt jetted to Paris for a signing ceremony photo op with France’s president, Francois Hollande. A few months earlier, the search giant had set up similar but much smaller subsidy for Belgian publishers. Concurrently, the company has been battling, so far successfully, proposed German legislation that would let publishers charge for search engine aggregation of their articles.

So is there a possibility that Google will ease the financial pain of American publishers with a similar agreement? Extrapolating from estimates by French news industry analyst Frederic Filloux, scaling up such a fund in the same proportion to U.S. newspaper industry’s advertising revenues would cost Google at least $2.6 billion.

My question is rhetorical. The chance of Google providing that kind of help here is slim to none — but for some interesting reasons.

  • A threat of aggressive government regulation is not even on the table in the United States. Publishers themselves see any government-brokered rescue as a breach of the First Amendment independence of the press.
  • Google’s lobbyists and lawyers are particularly potent here, but I think that mirrors a cultural difference too. In the U.S., Google is a home-grown hero, the biggest and best of our giant tech businesses. Europeans are suspicious of that kind of domination from our side of the ocean — an echo of European anti-trust actions against Microsoft in the 2000s.
  • Google has royalty agreements with the Associated Press and some other news outlets. American publishers have been using the company’s AdSense product for a decade to provide targeting and thus raise the effectiveness and price of digital ads. Plus, as Google executives delight in pointing out, traffic from search and the company’s news products significantly boosts the audience coming to the Web and mobile sites of American newspapers.
  • All this leaves U.S. publishers — despite a wave of Google denunciations in 2008 and 2009 from the likes of Rupert Murdoch and William Dean Singleton — more deferential than combative in practice.

When asking for comment on whether Google’s European adventures have any implications in the U.S., I got no response from Newspaper Association of America executives or those at the industry’s licensing arm, NewsRight. Google itself said at the time of the French agreement that the fund was not a model for Germany or the United States. Spokesman Ryan Brack declined to amplify on that for me.

At risk of rehashing the obvious, Google’s impact on the decline of print news advertising and the pokey growth of digital ad revenues has been, and remains, huge. The old news is that Google gets 90 percent-plus of its $50-billion-a-year revenues from advertising. It dominates search, substantially the biggest category within digital advertising and a great way for local businesses and services to target potential customers.

The newer news, courtesy of my colleagues at the Pew Research Center in the State of the News Media 2013 report, is that Google is prepared to dominate the next growth waves in digital advertising – mobile, video and data-driven targeted display — as well.

Google is now the largest U.S. player in display digital advertising, not just in search. Along with Facebook, Twitter and some others, it is a driver in the high inventory/low price dynamic for all forms of digital advertising that makes revenue growth for news companies so difficult.

I am not a Google basher. I do a dozen or two Google searches a day and don’t find competitor services much of a substitute. Gmail (free!) fruitfully applies search to the potentially time-eating chore of looking up correspondence and addresses. Plus there are Google maps, Google Docs, movie listings (including trailers) and much more.

Also, Schmidt and other execs at Google come to the table for conversations on the future of news. The company is making modest investments in news transformation. (Poynter will be among organizations welcoming its first Google-funded intern later this spring).

However, there is an underlying question of proportionality, that the French agreement raises anew. Google rightly sees itself as playing a constructive role in disseminating news with substantial benefit to news producers. But it sidesteps the implications of sucking away the lifeblood of old and new advertising revenues streams to the tune of billions.

Google has done more than its share of creative destruction of legacy news media, and its dominance also undermines sustainability for digital-only startups. I don’t seem to have much company in this opinion, but I think the company and it philanthropies could afford to do a lot more to ensure that core news reporting does not wither away. The European examples suggest that when the heat is turned up, the company will respond.

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  • PeterCaoHotel

    Kaifu Lee is a cat’s paw in a fascism circle; Kaifu Lee’s vice in China started from his self-potraited cleverness; He often takes advantage of his cleverness to fool the average Chinese people, and take advantages of the average Chinese people with his strong foriegn background;

    And in case of Kaifu Lee’s racy action on the Romneys, he is trying to fawn on Romney’s political rivals (e.g. Bill Clinton?) in the U.S., in order to bum for support from them to get Lee himself back to Google which Lee had abandoned to start his personal business in 2009; Kaifu Lee’s such despicable action has misled belief of Chinese people over American people, and also is a clear humiliation to the dignity of the people of the United States

    — Such a despicable behavior from such a despicable soul

    — Obviously, Lee’s vice had been harmful to both Chinese people and to the U.S. people

  • PeterCaoHotel

    Also, Kaifu Lee, who served as a cat’s paw in this fascism circle and who tried to get personal interest in collateral with such fascism circle to get back to Google China., which he had abandoned in 2009, had publicly humiliated the Romneys with a racy post on his weibo site right after the election is over;

    As a reminder, till today, that racy post on Kaifu Lee’s weibo site displayed on 2012/11/07 version of twitter, Kaifu Lee has over 20 million followers there) to humiliate an innocent woman, Romney’s wife , is still alive on Kaifu Lee’s weibo site;

    But a man with education should never publicly humiliate an innocent woman, even if she is wife of a presidential candidate, and especially after the election is over; Kaifu Lee, as a public figure owe Romney’s wife, as well as owe the general public, a formal apology over such a despicable behavior from him;

  • PeterCaoHotel

    Google has been besieged by powers from a fascism circle for years. The front figures in this fascism circle: Eric Schmidt, Sebastian Thrun, a criminal suspect Gabriele Scheler [Stanford police case number: IR #04-111-0335;Victim: Peter Cao; Criminal Suspect: Gabriele Scheler], certain officers who miscarriage of justice ZZZ/YYY/VVV; and more recently, Kaifu Lee,(who had ensued legal battle when he betrayed Microsoft to join Google in 2005, and who had betrayed and abandoned Google to start his own business, soon after he could take away all the Google stocks in 2009, a really treachery type;) and most of all, on 2012 Forbes List, the most powerful woman in the world, Angela Merkel, etc;

    There is a whole pack of fascists behind them in this fascism circle who tried to crash Google on way of covering up a series of fascism crimes starting from Gabriele Scheler’s campus atrocity case, otherwise powers of this fascism circle would repeat their plot to set up a coup in Google in favor of this fascism circle, as they had tried but failed last year? I bet they would, but they would of course fail again;

    My advice to powers in this fascism circle: stop playing tricks or you will always loose, face the facts, clarify the case, and assume legal and moral responsibilities

  • PeterCaoHotel

    My advise to powers in this fascism circle: stop playing tricks or you will always loose; face the facts, clarify the case, and assume legal and moral responsibilities

  • PeterCaoHotel

    Eric Schmidt is a member in a fascism circle, so is Kaifu Lee, Sebastian Thrun, Angela Merkel, etc. who had involved into a series fascism crimes which had endanger human lives and in retaliation against victims; so far fascism they had produced into our lives still prevails;
    Starting from Gabriele Scheler’s atrocity case on Stanford campus [Stanford Police Case Number: IR #04-111-0335;Victim: Peter Cao; Criminal Suspect: Gabriele Scheler;] there follows a series crimes in which Sebastian Thrun, Eric Schmidt, Angela Merkel, etc. and people associated with them had involved (e.g. Thrun’s student David Stavens had gone to police and file false accusation on me on behalf of Thrun’s side, and Eric Schmidt had threatened my life with the death of Stanford student May Zhou and later Schmidt had involved into an unsuccessful plotted murder on me as well); but their crimes had been covered up by certain malicious officers ZZZ/YYY/VVV with miscarriage of justice, and victim (e.g. me) was conspired and further victimized;

    — Believe me, the damage to a person’s life would be much worse and last forever out of egregious miscarriage of justice from certain malicious officers (in my case ZZZ/YYY/VVV, is VVV from FBI?), than from those criminals (in this case Gabriele Scheler, etc.) who had originally committed crimes on that person; you don’t want to have such a horrible experience; it’ll molest your whole life;
    — All tragedies in this case are caused by the miscarriage of justice from certain malicious officers; I am sure that until the date Gabriele Scheler’s case completely clarified at authorities, which officers ZZZ/YYY/VVV had tried to prevent from happening, such malicious officers would install more and more tragedies into our lives; When we clarify the case, we will see;
    — Who are officers in charge of Gabriele Scheler’s accusations ZZZ/YYY/VVV? they are the actual crime producers and time to clarify the case and end the dire consequences from their miscarriage of justice, and have them take the responsibilities; Would anyone like to live under the jurisdiction of such malicious and cowardice officers?