Google has stated that news content is not a significant driver of its advertising revenue, following the results of an experiment conducted in eight European countries. The tech giant removed news from search results for 1% of users over 2.5 months to assess its impact, concluding that it had little effect on user engagement or ad revenue.
Minimal Impact on Revenue and Usage
According to Google’s findings, the removal of news content resulted in a mere 0.8% drop in search usage, while advertising revenue remained unchanged.
“The study showed that when we removed this content, there was no change to Search ad revenue and a <1% (0.8%) drop in usage,” the company said in a statement.
Paul Liu, Google’s director of economics, responded to previous claims about the importance of news for the company’s profitability, saying, “We have seen a number of inaccurate reports that vastly overestimate the value of news content to Google.”
The company further asserted that the impact on ad revenue was so minimal that it “could not be statistically distinguished from zero, either overall or by country.”
European Experiment and Legal Challenges
The experiment was conducted in Belgium, Croatia, Denmark, Greece, Italy, the Netherlands, Poland, and Spain. However, a similar test planned in France was blocked by a court order, with authorities warning Google that it would face fines for violating an existing agreement with the country’s antitrust regulator.
Google said the test was part of its effort to comply with the European Copyright Directive (EUCD), a legal framework requiring tech companies to compensate news publishers for using snippets of their content. The law has been a contentious issue, as media organizations push for higher compensation while platforms like Google argue that news has limited financial value to their business.
Ongoing Disputes Over Compensation
The debate over how much Google should pay publishers remains a key issue in negotiations. France’s competition watchdog fined Google €250 million last year for failing to comply with intellectual property regulations related to news media.
Another major concern is Google’s use of news content to train artificial intelligence (AI) models. News publishers argue that their articles and reports are being used without compensation to enhance Google’s AI capabilities. This has fueled further disputes over intellectual property rights and fair compensation for content creators.
Implications for Future Negotiations
The findings from Google’s experiment are likely to play a crucial role in future discussions with European regulators and publishers. By demonstrating that news contributes minimally to its overall business, Google may push back against demands for higher payments.
However, with increasing legal scrutiny and growing concerns over AI content usage, the debate over fair compensation for news publishers is far from over.
