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September 12, 2012

Google v. French Publishing Industry - Is Content or Advertising King?

By Peter Bernstein, Senior Editor

So here is a case of “which came first the chicken or the egg?” According to leading French publishers, Google (News - Alert) should be paying them for indexing their content because Google derives substantial advertising revenue from user searchers for news contained on media websites. Google of course says “au contraire mes amis,” which means “to the contrary my friends.” 

Google’s point is that without people searching, the media would not have nearly as many page views where people can view/click on links to their advertisers. In English that translates into “lots of luck with that!” The French themselves have a great one word way of saying it, Incroyable!

This has all become more than mere semantics. French publishers are calling on their government to adopt a law to force search engines to pay for content. And, in an interview in the business daily Le Figaro by Nathalie Collin, the publisher of Le Nouvel Observateur, in exchange for a “fair payment” would give up their objection that Google index their news content. 

Image via Shutterstock  

This is not the first time the French publishing industry, struggling as all print giants are with falling ad revenue and still look for how to create large subscriber bases that will pay for their online versions, have tried to extract tribute from Google. In fact, French lawmakers back in 2011 rejected plans for a tax on online advertising revenue under the reasoning that it would hurt small local companies more than the big guys like Google, Microsoft (News - Alert), Facebook and Twitter. 

The imbroglio raises an interesting issue. The mantra of the digital age has been that, “Content is King.” It seems that is true depending on your content. I say this based on a belief that like it or not search is generically a form of content. 

The publishers wailing at Google has sound financial reasons behind it, as in they are getting pummeled in the market. The value of their platforms in the eyes of advertisers has been diminished, especially since Google has a lot more of those coveted eyeballs across all of its capabilities and not just search. However, this almost seems like a case of the boy who kills his parents and then asks for mercy from the court during sentencing because he now is an orphan. 

The posting that drew my attention to this lays out the basics. It is a nice read but what is really terrific are two comments that are worth reproduction.

Somebody who goes by Aloken noted:

Really? They have a problem with Google indexing their news articles and displaying them when people search for something? No one reads news in Google’s result pages, if they want to read something they click a result and are redirected to the source. Google should just give French companies an opt out and watch as a month or two later they opt in again because their own traffic dropped.

I thought that was a gem until I read what someone who goes by baudrunner had to say:

The newspapers are paying Associated Press (News - Alert) and United Press International (among others) a lot of money to run their news stories and they just want to pass those costs on to the readers (they're already getting plenty from advertisers), who do so by buying into the newspaper subscription. Google is only an indexing service and list provider, and if anything, newspapers should be paying Google to include their news stories in the results pages, the way that internet entrepreneurs pay-per-click their way to the top of the results lists. I can't find a way to justify the newspapers demanding payment from Google for adding to their readership.

I have more than a bit of admiration for baudrunner. That line about newspapers should be paying Google is a show stopper.  

There is an old saying here in the U.S. that, “if a tree falls in the forest but nobody is around, did it make a sound?” Translated to this instance, “if a newspaper publishes a great story but nobody reads it did it have any impact?” Advertisers are the ultimate rational consumers of services. They have very precise metrics for determining what channels give them the most visibility and engagement for their investments. Until and unless newspapers can create a value proposition that can deliver the kinds of engagement and leads advertisers are seeking — based on some combination of targeted demographics and psycho graphics — it is hard to shed tears for the fact that they literally are out of touch in the eyes of the people who spend money on marketing. 

While not a fan of Google’s increasing influence over almost all aspects of brand stewardship because of the extraordinary power of search, it certainly seems the French publishers are going to have a difficult time getting sympathy for their cause. They are just another source of information and insight and what they really need to be doing is creating content people want to read and are willing to pay for, and attracting followings that advertisers wish to reach and pay also are willing to pay for.

It hardly seems becoming for the publishing industry to play the victim here. It is almost as if they are approaching the government based a “too important to fail” basis.  Is content or advertising king? Turns out that is the wrong question since at the end of the day companies want to be compensated for their online services whether by subscription, advertising support or both. 

The publishers need to figure out how to compete more effectively not just against Google but anyone who is producing content on the web that is in all or in part advertising supported. If they cannot it may well be time to bid them au revoir!  

Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO West 2012, taking place Oct. 2-5, in Austin, TX. Stay in touch with everything happening at ITEXPO (News - Alert). Follow us on Twitter.

Edited by Brooke Neuman
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