One month of Google News Showcase: Is a new ad ecosystem shaping up?

While publishers continue to enjoy the reach of the Google News, experts are yet to gauge the future of how new publishers and advertisers will deal with each other

e4m by Tasmayee Laha Roy
Published: Jun 15, 2021 9:18 AM  | 5 min read

It’s been close to a month since Google flagged off the News Showcase feature in India with 30 publishers, who have benefitted from the reach of Google News. However, experts are yet to gauge the dynamics between new publishers and advertisers -- whether ads will be sold directly to Google or continue to operate the way it is now.

“The reason for the publisher's existence is content. The News Showcase program of Google allows participating publishers to offer their content for a fee to Google. So, it's really more of a change in the business model,” said Gautam Mehra, Chief Data & Product Officer- dentsu Asia Pacific (APAC) & CEO - dentsu Programmatic - South Asia.

Publishers receive monthly fees from Google when they agree to be a part of Showcase. While there are no details available on the deal size of the partnerships with Google, sources in the industry confirm that the money offered to the publishers is based on their popularity and reach. But is this fee enough?

"The fact that Google is paying news publishers who are part of the News Showcase is more like a joining incentive. In the long run, if most of the traffic is diverted to Google News rather than individual platforms then advertisers would also prefer to go to Google directly because they undoubtedly have the best programmatic offerings. This kills the scope of sales for media houses and many might lose jobs,” said Shradha Agarwal, COO and Strategy Head- Grapes Digital.

Mehra also thinks that News Showcase helps in certain ways but may have some downsides too.  “Right now publishers have to drive traffic to their site to be able to monetize them via ads. With the increase in privacy laws and practices, this is going to get harder for publishers in any case. On the other hand, Google has massive distribution and they can get a lot more revenue if the fee turns into a rev-share (like YouTube does). This is not to say that there is no downside to this move. Google is very large and this feeds more and more into their hands, but I guess this is the problem not for an individual publisher but more for our ecosystem,” he said. 

Anil Pandit, SVP, Programmatic, Publicis Media puts forth several other grey areas of the deal publishers signed with the internet giant last month. He believes that the partnership may result in multiple ramifications, impacting various players in the ecosystem, all in different measures. The biggest and the most direct impact, he emphasised, will be on publishers who chose to participate.

"It would be futile to comment on their behalf since it depends on the attractiveness of their revenue model (best known to them) and the way the relationship with their readers evolve post this transition. Will they continue to be meted out the same treatment in the hands of Google? Will this translate into increasing the gap between the readers and the core publishers? Who becomes the owner of their data? These are important questions in the light of the cookieless future that we will enter in 2022 where contextual targeting and harnessing second party data partnership will assume importance. Programmatic for advertisers will work better as long as we are able to use the above targeting in the most effective manner using a data-driven methodology,” he said.

According to  Abhishek Sharma, Head - Programmatic and Data, DDB Mudra Group, there are certain areas that publishers need to keep an eye out for.

For instance, currently, there are about 30 news publications, which have signed up for this product in India. With time, the number will keep increasing and soon there will be news from multiple publishers being displayed side by side or on scroll.

“In this situation, it means that various publications will now be competing against each other for the user’s attention as with a simple scroll or swipe you move on to the next one. It is similar to the dilemma of going D2C (Direct to consumer) vs E-commerce (B2B2C), where once the product is listed on an e-commerce portal you are then competing with products in your category and other categories also,” he said. 

Another important area that publishers need to keep in mind is organic user base growth. Sharma suggests the publishers should keep working on their own user base growth alongside enjoying the traffic that Google News drives.

“A programme which is here to aid shouldn’t become the default shop for the product,” he said.

While the kind of insights and analytics Google provides publishers about users reaching them through Google News Showcase is there to be seen, Sharma said, “Publishers must ask Google to be transparent in terms of understanding on what criteria would it push one publication before or after another. That would hugely determine who gets to the pie first.”

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