Google said on Wednesday that it finally struck a multi-year deal with News Corp, the largest owner of circulation newspapers in Australia, to pay for the content.
Why it matters: The deal, along with several others reached between Google and Australian publishers in recent days, will likely allow the tech giant to avoid a sweeping new Australian law that would have forced it and rival Facebook to pay publishers under conditions. that have been established by third parties as they could not make arrangements themselves.
Details: Google has agreed to pay News Corp. an undisclosed amount for content to be included in a new product called Google News Showcase.
- Among the News Corp publications joining becomes The Wall Street Journal, Barron’s, MarketWatch and the New York Post in the US; The Times and The Sunday Times, and The Sun in the UK; The Australian, news.com.au, Sky News and multiple metropolitan and local titles in Australia.
- The three-year deal also includes the development of a subscription platform for News Corp stores, according to a statement, as well as ad revenue sharing through Google’s ad technology services, and “cultivating audio journalism and meaningful investment in innovative video journalism through YouTube.”
In the past week Google has struck deals with several Australian publishers, including Nine Entertainment, Junkee Media and Seven West Media.
- Australian lawmakers have said they would avoid the law if Google and Facebook reached payment terms with Australian news outlets on their own.
- The bill was submitted to parliament for consideration this week.
- Had these kinds of deals not closed this week, the passage would inevitably have occurred in the next few days, although lawmakers have not said for sure that the law is 100% off.
Be smart: The News Corp. deal was the last remaining agreement with a publisher that Google needed to really escape the proposed law.
- News Corp owns about 70% of the Australian newspaper business and is known to have a strong lobbying influence in Australia on this issue.
- “The deal simply wouldn’t have been possible without the ardent, unwavering support of Rupert and Lachlan Murdoch, and the News Corp Board,” Robert Thomson, News Corp. CEO, said in a statement. Thomson also thanks Australian lawmakers for their steadfastness “for their country and for journalism.”
The big picture: What is happening in Australia serves as a litmus test for other countries looking to curb the power of Big Tech companies worldwide.
- The law would have made Australia the first country to force both Google and Facebook to pay news outlets for their content or it would be subject to hefty fines.
- Both Facebook and Google have said they will not be able to run their businesses in the usual way once the law goes into effect and warn that if Australia enacts it as expected, they will be taking some of their services from the country.
- Other countries in Europe and even the US are also considering measures to even improve the playing field between tech companies and legacy industries, such as newspapers.
These kinds of global threats have forced tech giants to create new features that send money to news outlets without having to completely rethink their business.
- Google said last fall it would pay publishers $ 1 billion to have their content appear in the Google News Showcase.
- Facebook has spent millions of dollars paying publishers to be a part of the Facebook News tab. Facebook News was launched in the UK last week
Go deeper: Tech coughs up money for news while threats lurk