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Google to make ‘significant’ payments to Rupert Murdoch’s News Corp

In a move that could herald the start of a sea-change in relations between Silicon Valley and publishers, Google confirmed yesterday it had inked a landmark deal with Rupert Murdoch’s News Corp. 

The deal will see the publisher’s titles in both the U.S. and UK (including The Wall Street Journal, New York Post, The Times, The Sun, and others) make some of their content freely available on its Google News Showcase. The exact terms of the deal have not been disclosed but are said to be ‘significant’.

News Corp. disclosed that the deal involves the development of a subscription platform, the sharing of ad revenue via Google’s ad tech services, as well as the further investment in podcasts, audio and video journalism.

Robert Thomson, Chief Executive of News Corp, said that the deal would have “a positive impact on journalism around the globe as we have firmly established that there should be a premium for premium journalism.”

The deal immediately sparked a wide range of industry reactions, mostly skewed to the downside. Whilst, on one hand, the news that Google is paying publishers for content could be seen as a move in the right direction, industry observers reflected that smaller publishers without the heavyweight presence of News Corp. will continue to be sidelined or ignored.

Martin Tisné, Managing Director of Luminate, a philanthropic organisation focused on building fairer societies, tweeted, “Google has the power to decide which news organizations should get money, and which shouldn’t. It is the big old legacy players who have political clout who can cash it in.”

Other industry commentators were more forthright. Jeff Jarvis, a professor of journalism and author of “What Would Google Do?, tweeted, “Google & FB won’t change; they will maintain unread news features as loss makers to pay off the publishers. The publishers won’t change because they got a little more money. Startups will suffer. News will suffer. Society will suffer. Well done everyone.”

It comes at a time when media companies globally are watching Australia as it moves to pass a law that would allow companies to join forces and negotiate directly with the Silicon Valley giants for payment. The bill has already made considerable progress and is expected to be passed into law. In response, Google has threatened to deny search engine access in Australia if the bill becomes law.

With News Corp’s Chairman, Rupert Murdoch, being Australian-born, and News Corp. Australia one of the country’s top media conglomerates, Google’s deal with News Corp. could be seen as a well-timed political ploy rather than a genuine bid to recompense publishers.

European Publishers Council (EPC) Executive Director Angela Mills Wade hinted as much, saying, “It is crucial that regulators worldwide, including in Australia and Europe, recognise that single deals  – especially just before comprehensive laws come into effect – will not ensure that publishers of all sizes, whose content is used by Google, benefit from fair remuneration.”

“We urge the Australian Government to continue with a full implementation of its new Code and, most importantly, to proceed to designate Search as planned, so that all publishers can seek fair remuneration in line with the objectives of the legislation.”

The developments come less than a month since L’Alliance de la Presse d’Information Générale (APIG), which represents the interests of around 300 press titles in France, reached a financial deal with Google over reuse of their content. Google did not say how much money APIG’s members might receive as a result of the agreement or disclose further details.

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