Removing news makes Google lose users, says study – 07/14/2023 – Market

Google will lose users and engagement if it removes news content from the search engine, indicates a publication presented during the Big Tech and Journalism conference, held in Johannesburg, South Africa.

The study interviewed 1,573 people in Switzerland between January 26th and February 8th of this year. According to the work, Google’s efficiency in answering questions drops with the absence of news content, which causes frustration among Internet users. This leads users to inform themselves directly through media sites.

Respondents used Google’s search engine in two versions – with and without links to journalistic content. In 70% of cases, they preferred the search engine that returned results that included links or media titles.

The survey also measured satisfaction with search results with and without news. Of users who used the version including media content, 73% said their search was satisfactory, while 67% of respondents using the version without media said the same.

According to the survey, the removal of news from the platform also affects Google in the longer term. Without journalistic content, 8% of people stop looking for information on the platform and most go straight to media vehicle websites.

“The integration of news content in search results makes the user experience more positive and enhances the use of Google. And the probability of using Google drops when all journalistic content is removed from the platform”, says the study.

The survey by FehrAdvice & Partners AG, supervised by economist Ernst Fehr, a professor at the University of Zurich, was commissioned by the Swiss Association of Publishers to support the discussion on paying for news content by big tech.

Switzerland is debating legislation similar to that of the European Union, which adopted the digital single market copyright directive in 2019. The law provides that search engines pay copyright to vehicles when using excerpts of content (there is no payment for links or very short excerpts).

The Switzerland study uses an economic model to quantify the value journalistic content adds to Google’s search engine – and what media outlets should be rewarded with.

According to the survey, Google earns around 550 million Swiss francs (US$ 640 million or R$ 3 billion) with ads in the search engine per year, specifically in information searches, which are around 55% of the total —the the rest are transactional searches, such as product purchases, or browsing, website addresses.

According to the survey, as 70% of people looking for information in the search engine insist on having results that include journalistic content, the study concludes that 385 million Swiss francs (US$ 448 million or R$ 2.1 billion) of ad revenues are directly benefited by news content. Using the standard ratio of around 40% for the site serving the ad, that would mean a payout of CHF154 million ($179 million) per year to media outlets.

The results clash with Google’s arguments. The platform claims that journalistic content does not contribute significantly to its revenue. The company says it generates traffic to the publications, increasing vehicle revenue. A blog post by Google states that news-related searches account for less than 2% of the total globally.

Big tech opposes legislation under discussion around the world, including in Brazil, for remuneration for journalistic content.

Recently, Google announced that it will block all links to news in Canada when local journalism compensation legislation, passed in June, takes effect. The law is similar to the Australian Bargaining Code, which came into force in March 2021. The model determines that vehicles negotiate individually or collectively (to increase bargaining power) with platforms payment for journalistic content. If they cannot reach an agreement, arbitration is envisaged.

According to Alexis Johann, one of the authors of the study, the calculation of the fair value of remuneration of media outlets refers to Switzerland, but can be done in other countries using the same principles.

“The study shows that people really like having news content on Google’s search engine, that journalistic content is seen very positively by consumers, and that helps create a profitable media ecosystem. So everyone who contributes to this lucrative ecosystem should be rewarded fairly,” he told Sheet Johann, who is managing director of FehrAdvice, a consultancy specializing in behavioral economics.

The survey also shows that the majority of Google users (on average 53%), when searching for information, stay on the platform and do not click on links that lead to journalistic or media sites.

This goes against big tech’s arguments that the platform actually drives much of the traffic to news sites, and consequently contributes significantly to the audience (and ad revenue) of those vehicles.

“The division of online traffic favors Google; that is, the media provides content that improves the experience of Google users, but, in most cases, has no commercial gain from it”, says the study.

The journalist traveled at the invitation of the University of Pretoria