Google no ‘newsagent’, says NewsMediaWorks’ Peter Miller

The chief executive of NewsMediaWorks has hit back at claims from Google that it's merely a 'newsagent' posting headlines.

Publishers reject Google’s argument that it is merely a ‘newsagent’ and distributor of news content. Picture: AFP

The chief executive of NewsMediaWorks has hit back at claims from Google that it's merely a 'newsagent' posting headlines, with Peter Miller declaring that the tech giant is continuing to misrepresent its role in handling news content on its platform.

Peter Miller, CEO of NewsMediaWorks, which represents Australia’s leading news media publishers, said that Google had built its business off the back of premium news content that it needed to pay for.

“Google contends that news publishers have long paid newsagents – traditional retailers – to distribute newspapers, acknowledging the value of acquiring audiences," Mr Miller said.

"Google also contends it sends readers to newspaper sites for free. This really misses the point. While both newsagents and Google have built their businesses off the back of news, only newsagents pay for the publications and content they distribute."

In a blog post to Google's website, the company's local managing director Melanie Silva had compared news articles showing up in Google searches to newsagents displaying posters of newspaper headlines.

"Google Search doesn't make any money when a user clicks on a news search result, rather when users click on ads," she said.

"In contrast, Google Search sends readers from Australia and all over the world to the publishers' sites for free."

Mr Miller added that the federal government's decision to develop a mandatory code to oversee commercial arrangements between the digital platforms and news media businesses, rather than a voluntary code, had proven that the tech giants had not acted in good faith during negotiations.

“The purpose of the code is to address the imbalance in bargaining power between digital platforms and news media businesses.

“It is clear, notwithstanding protestations of the digital platforms that they are working constructively with publishers, the government and the ACCC were unconvinced of progress in getting to the nub of the issue – digital platforms coming to terms with their bargaining power being recalibrated so that they pay for news.”

Google and Facebook will each soon be forced to pay millions for news content under a mandatory code for digital platforms.

Treasurer Josh Frydenberg announced the code last month after talks broke down to establish voluntary rules.

Ms Silva said in the blog post that Google had acted in good faith during negotiations.

“From the outset, Google actively engaged in the voluntary code process. Google acted in good faith, working constructively by consulting with more than 25 news media businesses – broadcasters, print and online publishers from metro and regional areas. We met with some publishers on multiple occasions to work through and understand complex issues.

"We have sought to be constructive in our approach from the outset."

Facebook and Google dominate the digital advertising market, benefiting greatly from the content of news publishers on their platforms.

For every $100 of online advertising excluding classifieds, $47 goes to Google, $24 to Facebook and $29 to other players.

The Australian Competition and Consumer Commission will finalise the code in July, months ahead of schedule.

Additional reporting: AAP.