Our longer range prospects are looking up

Reasons to be cheerful this week are of a strategic nature, but strategy will filter down to reality soon enough.

by Rob Corbidge

Published: 17:11, 22 June 2023

It would take a fool to set their face against some of the more negative news around publishing right now, especially given the immediate wider economic picture, yet this week brings two slices of good news that, while they're not manna from heaven, are at least indicative of a change in the weather.

Firstly, we have Gannet taking up the legal fight against Google's grip on advertising. The biggest news publisher in the United States isn't holding back: "Google controls how publishers sell their ad slots, and it forces publishers to sell growing shares of that ad space to Google at depressed prices," Gannett said in a statement. "The result is dramatically less revenue for publishers and Google’s ad-tech rivals, while Google enjoys exorbitant monopoly profits."

"Us?" said Google, sitting on some garden furniture made from millions of compacted twenties. OK they didn't say that, but they kind of did:  "These claims are simply wrong," Dan Taylor, VP of Google Ads, said in a statement. "Publishers have many options to choose from when it comes to using advertising technology to monetize."

There is a good deal of lazy criticism against companies such as Gannet by those who have never run businesses, particularly in much of the lamentable academic field that purports to study journalism. The fact is, the conditions create the company. Gannet still exists because it has a model than can work in the current adverse situation. The same with a number of other such publishing businesses globally. It's difficult to survive out there. 

In adding their own separate complaint to the legal actions already in motion in the US, where the Department of Justice and eight states are already suing Google for its alleged ad market monopoly, and the EU, where the Commission has made a formal antitrust ruling against Google that "takes issue with Google favouring its own online display advertising technology services to the detriment of competing providers of advertising technology services, advertisers and online publishers",  Gannet has stuck its battle flag in the ground.

Will others join it? Quite possibly, and if there's a whiff of "division of the spoils" in the air in the advent of a significant victory, then so be it. A post-Google dominated advertising world could be volatile, it will certainly be interesting, yet the main wonder will remain how such market distortion was allowed to continue for so long.

Good News Part Deux

In other good news, we have the development that leading larger publishing companies have been meeting with large tech businesses in order to discuss the use of their content in generative AI tools. 

Encouraging in this story are the words from Axel-Springer's CEO Mathias Döpfner, who stated that an "industry-wide solution" for payment over content use was the most desirable outcome. We know that the tech giants like to cut side-deals, and thus dilute the opposition, so any attempt at unity must be welcomed by smaller publishers.

Tricky areas to navigate exist. For example, Google has floated the possibility that publishers could opt-out of having their content used for AI training data, but one feels that must have a penalty attached to it, or even the suggestion of a future penalty as Google AI products are developed and shipped.

The reason Google are the dominant position they are currently enjoy is that at the time they acquired the ad tech businesses that are still the reason for their power is that no one fully understood what the consequences would be - and I include Google in that. 

This time around, as the AI monster grows a new hype tentacle every hour (no idea what a hype tentacle is ed.) publishers are prepared, seeing competition for what it actually is, and demanding their content is paid for. 

The longer term is looking up.