German Publishers Go After Google; Apparently Very Confused About How The Internet Works

from the welcome-to-online dept

It looks like Germany may be a new front in clueless attacks on Google. With newspapers and magazines admitting that they're too clueless to know what to do with traffic Google sends them, officials in Germany are opening an antitrust investigation into Google based on some of the most ridiculous logic we've heard to date:
Hans-Joachim Fuhrmann, a spokesman for the German Newspaper Publishers Association, said the Web sites of all German newspapers and magazines together made 100 million euros, or $143 million, in ad revenue, while Google generated 1.2 billion euros from search advertising in Germany.

"Google says it brings us traffic, but the problem is that Google earns billions, and we earn nothing," Mr. Fuhrmann said.
Okay. Let's pick apart this apples and oranges comparison. First off, Google earns 1.2 billion euros from search advertising which has almost nothing to do with news. It comes from people searching for cameras or cribs or cars. Google News had no advertising at all for most of its existence and only introduced ads in the US less than a year ago. In other words, no, Google is not making more than newspapers and magazines when it comes to its News site in Germany.

And, even if Google was making more money (which, again, there's no evidence that this is true), that still doesn't excuse Fuhrmann's claims -- which basically amount to him admitting that Google figured out how to make money and the companies he represents did not. Yet the publishers he represents had all of the advantages in the world. They were local. Google was not. They had been around for many more years than Google. They had brand recognition and loyalty that Google did not. Furhmann is basically admitting what a colossal failure the companies he represents have been. They failed to capitalize on a huge opportunity. And now, when Google sends them traffic, they are still failing to use that traffic wisely. And then they blame Google for it? Wow.
The publishers also complained about what they saw as a lack of transparency in the way Google presents search results and news snippets in its Google News service, saying the company was manipulating the results to help maintain its strong position....

"We often feel like Web sites are elevated in Google's search results if they have a strong business relationship with Google, and we think we can prove it," Mr. Fuhrmann said.
So go ahead and prove it. First of all, Google is a private company and can rank sites however it wants. It's an opinion of what Google feels is most relevant. If Google was not doing a good job, then people would go away. So basically, at this point, Fuhrmann hasn't just admitted that the publishers he represents have failed miserably to set up even the most basic business models for adapting to the internet, he's now suggesting that Google is purposely handicapping its own site by not presenting the absolute best results!

It's difficult to see how this makes any sense at all. The publishers are claiming that Google is purposely degrading its results (and they can prove it!) and at the same time complaining that they can't compete against those degraded results. Wow.

On top of all that, the article reminds us, as we discussed last year, that these publishers have convinced German Chancellor Angela Merkel to support a new copyright law that would force aggregators to pay up just to link to stories. It's as if Germany doesn't want the internet at all.

Filed Under: business models, germany, internet, newspapers, publishers
Companies: google

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  1. identicon
    STK, 21 Jan 2010 @ 1:39am

    Yes, we germans suck :)

    It is true, there are plans for a law to allow breaking up any company that has a monopoly position, even when it does not misuse it.
    But I don't think that Germany is able to break up Google, because it is after all an american company. They might be able to shut down the local german part, but that is all our country can do.
    Google company will leave our country, but that does not mean I cannot use

    Comment 29 mentioned our system where we pay when we own a TV, radio or computer with internet access. This has nothing to do with what the publishers want. We pay that money to fund the german public broadcasting. They do not show ads usually, movies and series do not have commercial breaks. Contrary is the commercial broadcasting which does not get any of this money. They have much advertizing.
    Of course you can argue if this system is fair, because even when you only watch commercial programs you still have to pay for the public broadcasting channels. A completely different matter.

    Basically, what german publishers want, is a copyright on news. Everyone knows the copyrights for movies, music, books. But now they want to invent a new one for news.
    In Germany we have many companies/institutions that take care of copyrights. The most known copyright collective is the GEMA. Everytime someone uses a music track for public purposes, they have to pay a license fee. Every radio station has to pay those fees, even internet radios. So everytime you use music to make money (intentionally or unintentionally) you have to pay. Those companies do exist for many different things: music, movies, pictures, photos, art and so on.
    But currently there is nothing like that for news. Except quotation rights, which means you may quote parts of it with source but not just copy the whole news article. Google with its news aggregator uses this. It provides a link to the news site and shows maybe a sentence or two.
    Because Google shows advertisements while displaying the results, so it does earn money from it. So what it did in the eyes of our german publishers: it used their articles to make money.
    So they want that new law: If Google links their articles, Google has to pay a license.

    But there would be no need for such a law. Publishers earn money from the links because people click them and read the article, along with bright flashy ads. Else they would have applied the very simple solution to stop Google from accessing their sites that was already mentioned here: robots.txt

    I will give you an example what I mean: Two newspaper websites now offer paid content. If you want to read local and regional news or in the archives, you got to pay about 5€. But for Google, everything is free on those websites. So Google can index all the content and link it for free. But normal people have to pay for the content. (Unless they know how to change the UserAgent in the Browser).
    So, why did they allow Google to index their sites for free? Because Google generates them traffic which then generates money from the ads. Saying that Google steals them money is hypocritic.

    Germany does not need a new law. It needs new publishers :)

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