Toward the end of Bloomberg’s story about a potential deal between Google and Twitter to display tweets in search results, this bit at the end made me sit up:
“There’s no advertising revenue involved in the deal between Twitter and Google, one of the people said. That suggests Twitter will receive data-licensing revenue, which was $41 million in the third quarter, up from $16 million a year earlier.”
In other words, Google is going to pay Twitter for better access to its content. Now, we don’t know if that’s actually the case, since neither company has confirmed the deal, let alone the terms.
But if that turns out to be accurate, it would seem to have huge implications for content across the Web, particularly for news organizations.
For years, publishers have been arguing to various degrees that Google should be paying for their content. Fair or not, I’ve lost track of the number of editors who have complained for years that Google is stealing newspapers’ content by displaying the headlines and extended snippets of text.
Those snippets have in particular become a hot-button issue in Europe between Google and publishers.
In Spain, Google turned off its Spanish version of Google News because of a law that took effect on January 1 that required search engines to pay publishers to display snippets. Since Google News doesn’t run ads, Google said paying for content on that service was not “sustainable.”
Meanwhile, Germany passed a similar law that caused Google to pull the plug on snippets there last fall. The ensuing drop in traffic had German publishers backtracking, asking for them to be restored, even as they continued to sue Google for compensation for using those snippets.
In general, Google has argued that the traffic it drives to news sites is ample compensation for use of a limited excerpt of content. And the outcry in Germany over the drop in traffic seemed to underscore Google’s point of just how valuable that dynamic is.
But circling back to Twitter, why doesn’t the same argument apply? Shouldn’t it be enough for Twitter to get the additional traffic that Google will drive without receiving a direct payment? What’s special about Twitter’s content?
The answer could well be that Google values not just the content of tweets, but the underlying data like location, sentiment, and engagement. And there’s a general assumption that Twitter being Twitter, it has more leverage with a tech giant like Google than, say, The New York Times. And this could well be a first step toward Google making an outright bid to acquire Twitter assuming the integration goes smoothly.
But for now, Twitter was able to gain some leverage with Google by placing some restrictions on access to its tweets via the terms of its application programming interface. In essence, the API and the limited ability of Google to crawl the entire volume of tweets created a kind of paywall that it appears Google is paying to go around.
Individual news organizations probably don’t have any power to make demands on Google. But anyone on the web can block Google’s ability to index their site. What it would look like if a cartel of news organizations around the globe decided to do just that en masse as a way to establish their own value, and create some leverage of their own with Google?
Of course, any suggestion that news orgs should be paid by Google tends to prompt a lot of eye rolling. And no doubt such a scenario remains far-fetched.
Yet given the hard feelings the news industry has towards Google, and its increasingly dire economic straits, I would be surprised if publishers everywhere aren’t looking at the deal with Twitter and asking themselves the same question:
“Where’s our check?”