Journalists were given little encouragement during a debate on the Priorities for Digital Britain -- a forum held in the wake of the recent report by the outgoing communications minister Lord Carter. Google – which earns 15 per cent of its global income in the UK – insisted it was sharing some of its massive online advertising revenue with UK newspapers and television channels but this was of little reassurance to news providers attending an event organised by the Westminster Media Forum (9.7.2009).
Patrick Barwise, emeritus professor of management and marketing at the London Business School, criticised Google for its failure to give any precise figures for the amount it was investing in the UK’s traditional news and information content. Google was currently receiving half the UK’s total online advertising spend but media researchers had found it impossible to determine exactly what proportion of that income was being reinvested in UK content. “Sixty per cent of online advertising is paid search and Google gets half of the search advertising but unfortunately little of the online advertising money is invested in long term traditional content,” said Professor Barwise. Peter Barron, head of communications for Google UK, Ireland and Benelux, said the company did share “$5.4 billion annual global advertising revenue with our partners, which includes most UK newspapers and television channels…and we are giving huge sums on money back to newspapers and the television industry”. But after the debate, when I asked for a precise UK figure, Barron said that this was not broken down and it was not available. What Google had was a partnership with all the main national newspapers in the UK. “We drive users to newspaper websites. We provide advertising on newspaper websites and we share the revenue”. However, as Professor Barwise had inferred it is difficult to get either Google or the newspaper industry to speak publicly about their financial arrangements. Carolyn McCall, chief executive of the Guardian Media Group, explained that Google indexed the Guardian’s content and sold advertising around it and the Guardian did get traffic as a result. “But we make no return on it. So people say: ‘Why not take the Guardian’s content off Google’. That would be suicide”. When challenged by Google who insisted there was no advertising on the Google news index but it appeared instead on the individual pages of newspaper websites, Ms McCall pulled back. She acknowledged there were ongoing discussions about commercial arrangements and she said she was not seeking a public confrontation. Ms McCall said that because of the dominance of the BBC’s online presence, the Guardian could not charge for its online editorial content. She thought there might be a possibility of charging for specialist content not available on the BBC’s sites, but when it comes to “general news and political content there is no way we can charge for it”. In his contribution to the debate, Peter Barron emphasised Google’s commitment to playing its part in developing the internet in the UK which was already the “world’s leading digital economy.” Over 70 per cent of British people already had access to the internet and as a result e-commerce had taken off. The UK spend on line was three times more per consumer than in the USA and one in five British people were now buying their groceries online. Seventeen per cent of the UK’s advertising spend was online and the UK was providing fifteen per cent of Google’s global income. Barron said that Google was keen to support British journalism. It would be contributing to a fund for investigative journalism and You Tube in the UK would soon be sharing in the resources provided for You Tube Reporters in the USA. 9.7.2009 EN