August 22, 2017
Google has unveiled efforts to help drive users to subscribe to news publications in response to publishers’ complaints that Google and Facebook now dominate online advertising. First, it is renovating its “first click free” feature that lets users access subscription publications via search. The company is also taking another look at publishers’ tools for online payments and how to target potential subscribers. The New York Times and the Financial Times will be the first to test these tools.
Bloomberg reports that Google vice president for news Richard Gingras said the company is also talking to “dozens of other outlets as media companies move toward online subscription models.” “It’s clear from news publishers that they can’t live on advertising alone,” he said. “But it’s also clear that we’re seeing a shift in a market.”
According to eMarketer, this year Google and Facebook will earn more than 60 percent of the $83 billion market in online advertising spending. To appease publishers, both tech titans are developing products to help publishers gain more subscribers.
Google’s new tools will “let publishers identify who may subscribe, determine how much readers would pay and speed up the process,” and, says Gingras, will “involve Google’s mobile payment services and its gargantuan ad targeting apparatus.”
“This is an area, clearly, where our knowledge about our users can be brought to bear,” he said. “There is no singular subscription strategy that will work for each publisher.” He would not say, however “if or how the company would be sharing revenue with publishers.” NYT’s Kinsey Wilson, an adviser to the company’s president/chief executive Mark Thompson, said it “hasn’t discussed revenue terms with Google yet.”
Google’s mobile publishing tools use open source software, which makes it a preferred platform for publishers, versus Facebook’s “hosted, walled garden.” The latter, however, “tends to be a far bigger driver of web traffic and, thus, an irresistible partner for the media companies.”
With Google, publishers can “bump up their articles high in search results, which otherwise bury pages that can’t be accessed for free,” but “in return … must give non-subscribers access to at least three articles a day for free.” Google and NYT are “testing ways to drop that number down.”
NYT reports that subscription sales rose 13.9 percent during Q2 and ad revenue rose 0.8 percent. The Wall Street Journal “dropped out of Google’s first click free program in February,” after which “subscriptions ticked up, but traffic from Google fell off a cliff.” This month, News Corp. chief executive Robert Thomson “told investors that the company was working with both Facebook and Google on digital subscription products.”