Google set to pay publishers $1 billion for news over the next three years

Google on Thursday promised to pay new publishers nearly $1 billion over the next three years. This pledge was made by Google’s chief executive Sundar Pichai, in a blog post.

“I have always valued quality journalism and believed that a vibrant news industry is critical to a functioning democratic society,” said Pichai.

For almost a decade, some new publishers including News Corp and Axel Springer have been calling on the tech giant to pay them for their content, but all attempts have been hopeless. However, in the Thursday blog post, Google said it has plans to pay publishers that are willing to create content for the company’s new mobile service called Google News Showcase.

The new Google mobile service will first launch in Brazil and Germany before it is launched in other countries. Germany’s Der Spiegel and Die Zeit, and Brazil’s Folha de S.Paulo have already registered to the part of the new program.

“The business model for newspapers—based on ads and subscription revenue—has been evolving for more than a century as audiences have turned to other sources,” Pichai said in the blog post. “The internet has been the latest shift and it certainly won’t be the last… we want to play our part by helping journalism in the 21^st century.”

Other tech giants like Facebook are also under pressure by publishers to pay for news. A lot of pressure has been on the social media giant to make regular payments to the media industry for sharing news content on its platform.

Recently, the Australian Competition and Consumer Commission (ACCC) developed a mandatory code for tech giants to pay for authorization to use any news content. If approved, a draft code will be given to Australian news outlets to secure payments in a couple of months.

Australian news publishers suggested that Google should pay them $600 million every year, a call that Google reportedly declined.

With respect to Google’s new mobile news service, executive director of European Publishers Council Angela Mills Wade told the Financial times that the council members were quite pessimistic.

“By launching a product, Google can dictate terms and conditions, undermine legislation designed to create conditions for a fair negotiation, while claiming they are helping to fund news production,” Wade said.