After years of calling out Google for its unfair domination of the online ad industry, News Corp. is getting closer to what it wants.
On Wednesday, the publisher signed a historic three-year licensing agreement with Google that includes an ad-revenue sharing component that will result in “significant payments by Google,” the company said in a press release, as well as the development of a subscription platform for the global publisher.
As part of the deal, News Corp. titles will join the Google News Showcase, including The Wall Street Journal, Barron’s, MarketWatch and the New York Post in the U.S.; The Times, The Sunday Times and The Sun in the U.K.; and The Australian, news.com.au, Sky News and multiple metropolitan and local titles in Australia. The agreement also includes a program for YouTube to invest more in video journalism with News Corp.
The Google News Showcase is a licensing program the tech giant created last year to pay publishers for high-quality news and develop more immersive storytelling experiences.
The announcement comes as Google is under threat of being banned in News Corp.’s home market of Australia under new legislation introduced in December, which would require tech companies to pay local news outlets for featuring or linking to their articles.
Google and Facebook have publicly pushed back on the legislation, saying it threatens to create untenable technical and financial situations for them, with Google threatening to pull out of the country if it’s passed.
For News Corp., the agreement is a major win after nearly a decade of antagonizing Google and Facebook for their duopoly over the digital ad market as an existential threat to news publishers.
“I would like to thank Sundar Pichai and his team at Google who have shown a thoughtful commitment to journalism that will resonate in every country,” said Robert Thomson, CEO of News Corp. in a statement, adding that the agreement will have a “a positive impact on journalism around the globe as we have firmly established that there should be a premium for premium journalism.”
He added: “This has been a passionate cause for our company for well over a decade and I am gratified that the terms of trade are changing, not just for News Corp., but for every publisher. … 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 news has big implications for Google, Facebook and other tech giants who work with publishers globally as media companies push for a more equitable distribution of ad revenue in the industry.
Australia’s proposed legislation has gained support in Canada and Europe, which are pushing for similar measures. And in the U.S., Microsoft president Brad Smith has called on the Biden administration to adopt similar legislation.
“There is not a single serious digital regulator anywhere in the world who is not examining the opacity of algorithms, the integrity of personal data, the social value of professional journalism and the dysfunctional digital ad market,” Thomson said on his company’s Q4 earnings call this month.