Google says it doesn't make money from Australian news, kind of

Google has said it does not make money from news, at least in a way where it can pass the funds onto publishers.

In a blog post, which comes in direct response to the Australian government announcing last month it would develop a code of practice to make tech giants such as Facebook and Google pay for Australian content if it is a source of profit, the search giant said it drives traffic to news sites more than 24 billion times a month, globally.

Under the header "Is Google making money from publishers' content?", Google fails to answer its own question, instead saying Google Search doesn't make any money when a user clicks on a news search result, but rather, only when users click on ads.

"News.google.com has no ads, nor does the news results tab on the search page," Google wrote.

"And even more broadly, searches for journalistic related queries are a very small proportion of all searches and very rarely return ads."

Google does not get paid for showing the ad, only if the user clicks on it.

"On Google Search, we show a range of results based on a user's query and provide links to the relevant website. In the case of news, publishers can determine how those results appear, setting the length of the short snippet from a story or turning snippets off entirely," it said.

"Google Search sends readers from Australia and all over the world to the publishers' sites for free -- helping them to generate advertising revenues from those audiences and convert them into paying subscribers."

Google said the traffic it sends has substantial value, claiming that in 2018 alone, it sent more than 2 billion visits to Australian news sites from Australian users, and a further billion visits from users outside Australia.

"Everyone benefits from this exchange," it said.

Google said while news content has significant social value, it is often difficult to make money from and that primarily news-seeking queries make up only a tiny percentage of the queries it sees.

"But by including news results next to other search results, we encourage users to click to view stories they might not have otherwise read, giving publishers the ability to show ads against those stories," it explained.

Discussing the mandatory code of conduct being developed by the Australian Competition and Consumer Commission (ACCC), Google said it welcomed the recommendation it previously made to develop a voluntary code, and that it was advancing a code "based on extensive and continuing consultation with news media businesses".

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"From the outset, Google actively engaged in the voluntary code process," it said, noting it wanted to "address some misconceptions".

"Google acted in good faith, working constructively by consulting with more than 25 news media businesses -- broadcasters, print, and online publishers from metro and regional areas.

"The ACCC asked Google to deliver a progress report by the end of April, which we were on track to deliver before the government changed the deadlines and shifted focus to a mandatory code. 

"We have sought to be constructive in our approach from the outset."

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