San Francisco - Alphabet’s Google is developing new tools designed to boost
subscriptions for news publishers. It follows a similar olive branch
from Facebook to an industry that has seen the digital behemoths
take over the online advertising market.
Google’s latest foray arrives on three fronts. The first is a revamp
of its feature, called “first click free,” that allows readers to access
articles from subscription publications through search.
Google is also
exploring publishers’ tools around online payments and targeting
potential subscribers. It’s all part of Google’s broader effort to keep
consumers and content-makers returning to the web, the lifeblood of its
Initially, Google is testing the tools with New York Times and
the Financial Times. But
Richard Gingras, Google’s vice president for news, said the search giant
is 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
Media companies are focused intently on online subscriptions as print
ads shrivel and digital ad spending consolidates with Facebook and
Google, which together this year will garner more than 60% of the
$83bn market, according to EMarketer.
In response, both digital
platforms, which have rocky relationships with publishers, are
introducing products catered to them.
Facebook said last month it was working to add subscription tools inside
its Instant Articles program, which hosts news articles in its mobile
Google’s version, called Accelerated Mobile Pages or AMP, enables
news websites to load more quickly inside of search. With the new tools,
Google is looking at ways to let publishers identify who may subscribe,
determine how much readers would pay and speed up the process.
Gingras said the new effort would involve Google’s mobile payment
services and its gargantuan ad targeting apparatus, although he didn’t
“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.”
Gingras declined to say if or how the company would be sharing
revenue with publishers. Kinsey Wilson, an adviser to Mark Thompson,
president and chief executive officer of The New York Times, said the
media company hasn’t discussed revenue terms with Google yet.
To date, publishers have favoured Google’s mobile publishing tools,
which run on the web using open-source software. “Facebook’s environment
is a Facebook-hosted walled garden,” Wilson said. The social network,
however, tends to be a far bigger driver of web traffic and, thus, an
irresistible partner for the media companies.
Some publishers with subscription paywalls are concerned about
Google’s search policy. If publishers sign up, they can bump up their
articles high in search results, which otherwise bury pages that can’t
be accessed for free. In return, they must give non-subscribers access
to at least three articles a day for free.
Right now, Google and the New
York Times have been testing ways to drop that number down, Wilson
said. The product changes are expected to come next month.
“Early results are that there is some flexibility here,” Wilson said. Sales from
subscriptions gained 13.9% for his company during the second quarter while ad revenue rose 0.8%.
News’s Wall Street Journal dropped out of Google’s first click
free program in February. After the newspaper ended the program,
subscriptions ticked up, but traffic from Google fell off a cliff. The
told Bloomberg News that the policy “discriminated” against paid news
Gingras said the policy was designed to help publishers while
providing search users accessible information. “They chose to go down
that path,” he said of the Wall Street Journal. “They were aware of the
possible risks of doing so.”
In an earnings call earlier in August, News CEO Robert Thomson
told investors that the company was working with both Facebook and
Google on digital subscription products.
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