Google Plans to Share Revenues with News Publishers
https://www.ft.com/content/5609bbfe-b4cf-11e7-aa26-bb002965bce8
Google has launched a new model similar to its advertising revenue model to match up potential subscribers to newspapers and magazines that offer digital subscription. Google will use information it has on its users based on searches and clicked links to match each one up to outlets they might be interested in. Part of this new model is that the companies that are participating in the scheme are going to receive some compensation based on the revenue Google makes in clicks for advertising them.
Google has split ad revenue in the past with web publishers the ads are placed on. Online journalism publishers, however, are not concerned so much with the revenue sharing. The article stated that most news outlets are just happy to have access to “Google’s wealth of data”, something that could be instrumental in increasing a company’s subscriber count if implemented the right way.
Google has hundreds of millions of users, and has gathered data on each one of them. This makes Google’s PageRank system one of the most valuable on the web, as websites and companies jump at the opportunity to gain access to that data and better refine their target audience. Because of this, Google has become a dominating power in digital advertising and is looking to tap into the digital subscription model. While this will generate a new revenue source for Google, the companies that will benefit the most are the publishers that are being bumped up to the top of users’ result lists.
In class, we talked about PageRank and how the web has various algorithms that sort search results relevant to each user. Google’s ad scheme has worked this way for many years, where based on what users click and what they search, ads are ranked by relevancy to them and shown on their browser. This allows Google to make a huge amount of revenue from advertisers who want their ads to have a higher rank than others. A similar model is seen here, where different subscription outlets are being ranked for users.