Last year, Google brought in $136.8 billion across all its revenue streams. It's breaking into video games and the travel industry, and cementing its hold in digital advertising.

But a new study is putting the focus of a lot of powerful people on a fairly small percentage of Google's total revenue: about $4.7 billion. 

That's how much Google made from news content created by other companies during 2018, according to the study by the News Media Alliance. If accurate, it would mean Google made almost as much from these other companies' work as they did.

But, this is a highly controversial estimate. And it comes at a very interesting time.

'The current dynamics ... are devastating"

Google is one of the massive tech success stories of the 21st century, and its ascendence coincides with the demise of many news and journalism organizations.

But is one responsible for the other? Well, according to the News Media Alliance study, news makes up "40 percent of clicks for 'trending' queries" on Google search, "and about 16 percent of clicks on 'most searched' results."

So the big question is whether Google and other tech companies are nevertheless unfairly monetizing other people's work. 

"The current dynamics in the relationships between the platforms and our industry are devastating," said Terrance C.Z. Egger, chief executive of Philadelphia Inquirer PBC, which is part of the News Media Alliance -- and who was quoted in an article about the study in the New York Times, which is also part of the alliance.

'Back-of-the-envelope'

The News Media Alliance's $4.7 billion figure does seem less than ironclad: it's largely based on a 2008 statistic the Google made public, when it said it was making $100 million from news. 

However, the alliance actually thinks the estimate is conservative, because according to Tracy, "it does not count the value of the personal data the company collects on consumers every time they click on an article."

Google isn't buying it. It's deriding the study's calculations as "back-of-the-envelope" and "inaccurate."

Among other things, Google doesn't actually serve ads on most Google News search results. So it's hard to know exactly where the revenue is supposed to be coming from.

"Every month Google News and Google Search drive over 10 billion clicks to publishers' websites, which drive subscriptions and significant ad revenue. We've worked very hard to be a collaborative and supportive technology and advertising partner to news publishers worldwide," according to a Google spokesperson.

'You write for them'

Now, how's this for interesting timing?

The News Media Alliance's report comes out just a week after news leaked that the federal government -- both the Justice Department and Congress -- would be starting antitrust investigations into Google's parent company, Alphabet.

And, the report came on the eve of Congressional hearings today that will cover whether big news organizations should be given an exemption from antitrust laws so that they could negotiate with Google as a single entity over this very issue.

Because whether it's $4.7 billion, or more than that or less, it's a lot of money for sure. 

And whether Google and other tech giants created the system by which news organizations simply put their content out for free and depended on ad revenue -- or else simply benefited from it -- it's a pretty brilliant model.

"The big tech companies 'like this  business.' It's a good business, where you write for them," David Chavern, the president and chief executive of the News Media Alliance, told the Times.

Published on: Jun 11, 2019
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