Rupert Murdoch’s News Corp has agreed a groundbreaking deal with Google, securing “significant payments” for its journalism and setting a new standard for relations between international publishers and Big Tech.
The breakthrough in the long-running News Corp campaign came as Australia, the cradle of the Murdoch media empire, began debating laws on Wednesday that would force Google and Facebook to pay for news.
Google and Facebook have been rushing to complete deals with Australian publishers in an attempt to blunt the force of the landmark bargaining code, which is inspiring other regulators in Europe, the UK and Canada.
However, the Google deal with News Corp announced on Wednesday goes beyond the Australian market, extending to Murdoch titles such as the Wall Street Journal and New York Post in the US and the Times and the Sun in the UK. No other news publisher has reached a single deal with Google across multiple countries.
Robert Thomson, News Corp’s chief executive, said the effort to make platforms pay for using news content had been a “passionate cause” for the company for “well over a decade”.
“I am gratified that the terms of trade are changing, not just for News Corp, but for every publisher,” he said. “For many years, we were accused of tilting at tech windmills, but what was a solitary campaign, a quixotic quest, has become a movement, and both journalism and society will be enhanced.”
The terms of the three-year deal cover licensing payments for content used on Google’s News Showcase feature, the development of a subscription platform, the sharing of ad revenue via Google’s ad technology services, and other audio and video projects.
Google pledged last year to spend $1bn over three years on buying news content, and has reached agreements with publishers in about a dozen countries. But people involved in negotiations in Australia told the Financial Times the sums now under discussion were “multiple times” the size of agreements signed in other parts of the world.
The size of News Corp’s deal with Google was not disclosed. Thomson said earlier this month that an agreement with the US group would “benefit our company’s financial fortunes” and have a “material impact”.
Don Harrison, president of global partnerships at Google, said the agreement with News Corp covered “a wide range of our products”. “News Showcase now has partnerships with over 500 publications around the world,” he said, adding that the company hoped to “announce even more partnerships soon”.
The legislative passage of the bargaining code in Australia is being closely watched in Europe and the US for evidence that a tougher approach can reset the balance between publishers and tech platforms.
Among the code’s features is an arbitration system that would make binding decisions on the fees that Facebook and Google would have to pay news providers if commercial negotiations fail.
It remains unclear how Google’s rush of dealmaking in Australia will affect the bill and its implementation. As well as the deal with Murdoch’s News Corp, Australia’s biggest publisher, Google signed a letter of intent on Wednesday with Nine Entertainment, another large media group in the country.
Angela Mills Wade, executive director of the European Publishers Council, said the global News Corp deal “proves without doubt the value of news media content to Google”.
However, she warned regulators in Australia and Europe to “not be misled into thinking that single big deals between Google and a few influential media companies — just before comprehensive laws come into effect — are the answer to the fair remuneration due to all publishers under the law”.
“The government should continue with a full implementation of the code,” she said.
Credit: Financial Times