This figure of "$ 4.7 billion" for how much money does Google earn in the information sector? It's imaginary "Nieman Journalism Lab

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Journalists are generally happy to deplore the role played by Google in reducing their profession to a lower business figure. (Have two beers and try them!) But if there is one thing, they are even more glad to do it is to complain about botched work.

That's what a lot of Twitter media did today after a little-searched story in The New York Times last night: Google made $ 4.7 billion from the newspaper industry in 2018, according to a study.

The Making the Saying study comes from the News Media Alliance, a professional group of the newspaper industry formerly known as the Newspaper Association of America. Here's an excerpt from the NMA press release:

The News Media Alliance today released the results of a new study analyzing the use and benefits of Google for news. One of the key findings of the study is that information is an essential source that Google is increasingly relying on to encourage consumers to use its products. The number of news in Google search results ranges from 16 to 40%, and the platform has generated an estimated $ 4.7 billion in revenue in 2018 by exploring and scraping the content of news publishers – without paying publishers for this use.

The study, which contains an analysis by experts from Keystone Strategy, a strategy and economics consulting firm drafted by the News Media Alliance, includes a qualitative overview of Google's use of information content, an analysis of the amount of news content on Google Search and Google News, and an estimate of revenue that Google receives from news.

$ 4.7 billion is a big part of the change, and the papers say Google should give some back. But right now, people started to thrust at this number – in particular, the absurdly absurd contribution on which the whole Megillah rests: a wandering figure mentioned at a luncheon in 2008. It's incredible, honestly.

Here is the "study" section, which you can read in full here (page 23). The fact is that Google does not have a line item in its quarterly earnings reports for "Looting revenue from the traditional newspaper industry," and they needed a way to come up with a number:

Google search content that does not directly generate revenue is still a significant benefit for Google because users who visit Google for free are the same users who click on ads. Although it is difficult to measure the monetary value of this content, Google has provided a reference. Google has estimated that Google News, product without advertising, reported about $ 100 million in annual revenue in 2008. Although Google has not provided more recent estimates of the value of the content of the program. information, the $ 100 million cited by Google for Google News (which has no ads) can be extrapolated in a simple way to suggest to Google an estimated turnover of $ 4.7 billion in 2018 to from news content on Google Search and Google News.

Whoa whoa whoa whoa whoa. Did you catch that? Google said a figure in 2008, 100 million dollars. From this figure, you can "extrapolate directly" to $ 4.7 billion.

Let me start listing some of the questions here.

  • Einstein's work on special relativity Is argue that space and time are in fact part of a unitary continuum capable of falling back theoretically into traversable wormholes, you can not just say 2008 × a multiplier = 2019.

    If you proposed this concept – that we live today in a simply extrapolated in 2008, with the exception of children who are now using TikTok – you would calculate that the United States will elect 1.08 black presidents this year. After all, he elected a black president in 2008, while the country had 304 million inhabitants. With the strong population growth of 329 million today, you can simply extrapolate it. Directly.

    You would also deduce that each year is now the International Year of the Potato, Suzanne Pleshette would continue to die, and Stuff White People Like would continue to feature prominently in the crop.

    According to my bathroom scale this morning, my son has earned exactly 39.7 pounds since the beginning of his creation until he was four years old. Obviously, he will weigh 645 pounds at his retirement party.

  • In 2008, Google News did not "report" $ 100 million the way you think. Google News does not have ads. As a result, it does not generate any direct income. However, like all Google products, it is an additional way to attract visitors to the search engine, where is the real money.

    As far as I know, our only historical account of this fateful 2008 discussion is this Fortune article by Jon Fortt:

    Google News is free and contains no ads. So, what is it worth for Google? About 100 million dollars.

    Google's Vice President, Marissa Mayer, Research Product and User Experience Leader, speaks at a Tuesday afternoon session at Fortune's Brainstorm Tech conference in Half Moon Bay. California.

    How does it value a product that does not earn money directly? The giant numbers online that Google News directs readers to Google's main search engine, where they perform searches that produce ads. And it's a good deal. Think of Google News as a $ 100 million search engine.

    It is therefore a rough estimate of the number of Google News users influenced by the use of Google search. (I'm sure many frequent users of Google News have never heard of this scary start-up also had a search engine – lead generation!). It's a number "thrown" by a Google VP – not a memorable prime number, but a nice penny, the kind of number you could pull out of nowhere when you're asked a question about dry talk chicken.

    This – and that only – is the basis of a Google made $ 4.7 billion from the newspaper industry in 2018, according to a study title 11 years later.

  • Nothing in this reasoning is specific to the information industry. The argument is that Google is flouting publishers by making all that money and not giving some of that money to newspapers. Or, as the NMA said: "explore and delete the content of news publishers – without paying publishers for this use".

    "Creeping and Scratching" may sound a bit rude if you say them funny, but to say something, it's "crawling and scratching", that's another way of saying it's a search engine. You can not have a search engine without someone visiting any websites on the internet and see what is posted there first. Bing does it! Baidu does it! AltaVista did it! It's just a part of the job.

    If you think that being a search engine is somehow unacceptable without giving money to the, um, crawled and scratched, the new industry might have a strong argument. But it would be the same the other 1.5 billion websites on the Internet. Essentially, you're saying that it's not just $ 4.7 billion in benefits that Google has acquired that are inherently ill-gotten; all of their search engine earnings, all which is generated by the exact same process.

    I know it's sometimes tempting to say YES GOOGLE 100% BAD KILL IT KILL IT. But the information industry argument here only makes sense if you think search engines should be totally banned, which is stupid.

These fundamental faults do not even enter other reasoning flaws. As the primary What Google News does is … direct traffic to news sites! Billions of links that we click, every day. Presumably, news agencies have monetized these visits, one way or another? Maybe by putting ads on their site? Does this mean that all advertising revenue generated by visits generated by Google is ill-gotten? "An information industry earned $ 9 billion from Google in 2018, according to a study."

Here's the reality: Google is really making money – in an alternate universe where the Web had never existed, no one had ever thought of creating a search engine, or idea to use search queries to personalize ads had never arisen in the mind of anyone – would go to the newspapers. But that's not because Google uses sophisticated accounting to sneak in quarterly exploration payments. This is because:

  • Google has created products and services for consumers – such as Google Search – that people think are valuable enough to get their attention in huge numbers, day and night.
  • Google has created a much better and much more effective digital advertising product than newspapers or, in their current form, never could.
  • Previously, newspapers benefited from the fact that people had very few options for information, information, entertainment and entertainment. Users now have an infinite number of functional options and do not choose logs.

And now, we know that they can do math as well as newspapers.

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