Google could close Google News thanks to EU rulings

Tom Bedford November 19, 2018

Google has warned that its Google News service could close in the EU if Article 11 goes ahead.

Google could close Google News thanks to EU rulings

Article 11, sibling to the contentious Article 13, proposes a tax on companies like Google if they link to a news story from a recognised publisher. Since Google News is a hub composed entirely of news stories from publishers, it would require the company to pay hefty charges to continue to exist.

The Article is aimed at compensating news publishers for the low revenue they see from online advertising. Compared to the higher payouts traditionally found in print publishing, as online advertising is mainly controlled by Google’s own systems, returns can be miniscule. The European Commission’s solution to this problem is to tax sites that include links to online publications.

However speaking to The Guardian, Google’s vice president of news Richard Gingras suggested that Google News would have to close in EU countries if Article 11 passed. That is, unless the EU was willing to change its wording somewhat. “We can’t make a decision until we see the final language,” he explained, adding that “what we want to do is work with stakeholders.”

The company is lobbying the EU to change the wording of the Article, however Google is not currently in the EU’s “good books” after being issued a groundbreaking £3.8 billion antitrust fine in July. Gingras made sure to emphasise that Google News is one of the few non-profit arms of Google “It is not a revenue-generating product to Google,” describing it more as a philanthropic venture than a news hub, “We think it’s valuable as a service to society.”

In 2014 Spain tried implementing their own “link tax” for Google, which resulted in Google News closing there, a move which reportedly brought lower traffic to Spanish news publishers. The average drop in traffic for sites was over 6%, although some lost up to 14% of traffic flow, which had a knock-on effect on ecommerce and advertising revenue. Which certainly provides some compelling evidence for keeping Google News around.

However, a precedent has been set by some of Google’s leadership team changing their tune regarding the proposed EU laws. YouTube CEO Susan Wojcicki initially said the platform would have to block uploads from EU nations due to Article 13 but has since come to embrace the changes wholeheartedly. It remains to be seen if Google really will close Google News in the EU, or if it’s simply just calling the EU’s bluff.

While Article 11 seems created with the best intentions, its ramifications could be devastating to online news. Most news sites link to other sites, such as the earlier link to The Guardian in this article, and few publishers would be willing to pay for the privilege of including links to rival other publications. In addition, Google isn’t the only company providing valuable aggregate services. Sites like NewsNow, Rotten Tomatoes and Metacritic would be hit just as hard, and the removal of these sites could have huge repercussions for smaller publishers who depend on these links.

It’s clear that the EU certainly has some work to do with making Article 11 really work for everyone, but it remains to be seen if Google will be able to convince them otherwise.