Dinsmore: News Media Content Has Never Been More Popular
News media content has never been more popular than it is now yet revenues are shrinking because of Google and Facebook’s stranglehold on the digital advertising market, national publishers have told peers this week.
Speaking at a House of Lords Communications and Digital Select Committee session as part of its inquiry on the Future of Journalism, News UK chief operating officer David Dinsmore and Peter Wright, editor emeritus at dmg media, spoke of the paradox of the industry’s enormous reach coupled with a squeeze on digital revenues.
Mr Dinsmore said both publishers invested hundreds of millions of pounds a year creating original journalism and original content that “probably reaches every household in the UK in some shape or form.”
“We don’t have a popularity issue. Our content has never been more popular than it is now,” he added. “But this has become a bit of a publisher’s paradox
Mr Wright said: “As far as the commercial relationship between news publishers and the platforms is concerned, it’s a business relationship between two partners in which one partner has all the power. Google are completely dominant in search, which is one of the main means of distribution of news.
“They have around a 90 per cent share of search. They’re also completely dominant in the digital advertising market; they provide all the intermediary services through which we sell advertising.
Speaking about both Google and Facebook, Mr Wright said: “We have to accept what terms they impose. Even the contracts we sign to use their services are often presented to us on a take-it-or-leave it basis.
“So, what we’re asking for here is for regulation – and the CMA are about to report on a massive piece of work they’ve been doing – to address a massive imbalance in the business relationship.”
Mr Dinsmore said that news publishers were responsbile for “every word that we publish” yet the platforms continued to claim they were not responsible for what’s published, despite monetising it.
Both publishers heralded the approach taken in Australia and said that even if the eventual agreements were modest it would be transformational, especially for the regional and local press.
Speaking about the process of publishers, Mr Dinsmore said: “Added to that, I liken us to diamond miners; we spend a lot of time going underground, digging out the diamonds, checking the quality, making sure that we cut them well, we edit them, we curate them for our audiences, and of course if they turn out to be cubic zirconia we pay the penalty for that, we go in with our eyes wide open.
“The problem is that when we bring them to the surface now, they are taken from us. Other people will copy them and they are distributed far and wide. And that’s actually the frenzy that feeds the digital platforms. So the more content they get, the more hits they get, the more data they drive and ultimately the more revenue that comes out of that. That is in a nutshell the problem that we are facing, and that’s what we have to address.”
Speaking about industry collaboration, Mr Dinsmore cited his time as chair of the News Media Assocation and said it was a great example of the industry coming together to work on different issues.