Google has told the Competition Commission that the revenue the search giant earns from news content is “not substantial”, citing 2022 figures that showed news queries accounting for less than 2% of total search query volumes in South Africa.
In stark contrast to last week’s presentations by media houses, including Naspers-owned Media24, which painted Google’s approach as exploitative, the presentations by Google News partner lead for sub-Saharan Africa Marianne Erasmus highlighted the contributions the company has made to the local news ecosystem.
“Fundamentally, our intention is to build durable partnerships with the news industry that will foster a sustainable, resilient and diverse news ecosystem – as opposed to engaging with the news industry through purely transactional relationships,” Erasmus told the Competition Commission’s inquiry into media and digital platforms in Pretoria on Tuesday.
According to Erasmus, Google made only US$1.9-million in ad revenue from its News product in 2022. In contrast, she said, Google sent more than 600 million free referral clicks to local publishers in the same period, which she argued could be monetised through subscriptions and advertising.
Among the contributions made to the industry by Google and listed by Erasmus were The Digital News Initiative and News Labs launched in 2015, which she said were to support publisher innovation and provide digital skills to journalists. The Google News Initiative, launched in 2018, included products and programmes to help publishers “better monetise” their businesses, she said.
“For the past 20 years or more we have been developing products, training and a set of mutually beneficial partnerships to anchor our relationships with this industry,” said Erasmus.
‘Dominant’
But the experiences of publishers attempting to thrive within Google’s ecosystem appear to conflict with the benevolent image Erasmus depicted to the commission on Tuesday. In his presentation to the commission’s inquiry panel last week, Moneyweb editor Ryk van Niekerk, for example, described Google’s attitude towards publishers as embodying a “take it or leave it” approach.
Van Niekerk decried Google’s alleged frequent and abrupt changes to its search engine algorithm, which attracted additional costs for publishers that experienced a decrease in traffic as a result. Van Niekerk also slammed Google’s revenue model, saying it undercut publications and forced them to charge less to direct clients, thus harming the media industry.
“We are in a Google ecosystem, and you cannot get out [of that]. Even if you get out, you might as well close your doors because they have become so dominant in directing internet traffic and what is displayed to audiences,” Van Niekerk said.
Media24 CEO Ishmet Davidson also blasted Google for abuse of its market dominance, saying it threatened the viability of the Fourth Estate in South Africa. Ishmet said Google was sucking advertising revenue out of South Africa, making it increasingly difficult for local publications to survive. He said even News24, despite its size, was loss-making – and he pointed the finger at Google and rival Meta Platforms, the owner of Facebook, for the dire situation facing local publishers.
At Tuesday’s proceedings, acting deputy commissioner at the Competition Commission James Hodge criticised Google’s representatives for their “extreme attitude” and “unwillingness to accept even the smallest bit [of the accusations against the company]”.
“It is not helpful to this debate,” said Hodge.
But Google MD for News and Books partnerships in the Middle East and Africa Sulina Connal retorted by saying the company’s attitude was to counter the approach taken by publishers such as News24 and Moneyweb, citing an example of the search giant being accused of only giving the publishers “crumbs” as an “extremist” position.
“Some of the comments given by publishers last week were extreme. Our position is that we are here, we are engaging and we do want to be a part of the solution. But we also have to move away from this idea of ‘crumbs’ and some of the other comments that I cannot bear to repeat,” said Connal.
“We already make substantial and tangible investments into the news both globally and locally, and we urge policymakers to acknowledge these investments as they look into the relationship between Google and the news,” said Erasmus.