We're not the ATM: Google says no to Competition Commission's R500m proposal to fund SA news

Daily Maverick

29-04-2025

Marianne Erasmus, Google news partner lead for sub-Saharan Africa, spoke to Ferial Haffajee in the sixth part of our series on media sustainability and the Competition Commission report on Big Tech and its impact on the media in South Africa.
Question: How do you get your news?
Answer: I am reflective of the increasingly quick change in consumer behaviour. I am on simultaneous screens: WhatsApp, social networks and LinkedIn. I pop into a news article or a push notification, or I swipe left on my phone to go into a Discover feed [an interest-based feed on Android phones]. I've got a few news subscriptions that I read daily; they are local and global. It's the nature of my work.
Q: Google says the Competition Commission's report does not account for how people get news. In your opinion and research, how do people get their news today?
A: So, interestingly, the Competition Commission themselves did a consumer research study, and in their own study, it shows that only 17% of South Africans get their news via Google Search, and by far the majority, 77%, get the news via social media. The Competition Commission wants to ensure that public interest journalism is sustainable in the future. What they're trying to achieve, though, is getting consumers to go back to a newspaper's homepage, and they're not considering how news consumption behaviour has changed.
It's a misnomer to think that the next generation of news consumers will always seek out a website's homepage first. My sense is reflected in my own behaviour and in the Competition Commission's study, which shows successful content creators and publishers find a way to package their content so that they go and see the reader, where that reader is.
Q: An important question about the inquiry relates to democracy. The Competition Commission finds that media freedom is intrinsic to free expression, which is key to the Constitution. The Constitution is the key to democracy. It finds that digital platforms may harm democracy by harming sustainable media. It proposes a fund to begin to set this right.
A: We also advocate for media freedom. Businesses do better in open societies, which is only possible in democracies. News media, as a public good, is essential for democracy and society and, therefore, needs to be supported. The contestation comes in the form of how and who is responsible for supporting the media.
Q: Google has said that the Competition Commission report tries to resurrect outdated business models. We've spoken a bit about that already, but expand your thinking for me because it's quite a thing to say [about a regulator].
A: Google acknowledges the societal value of news, but we must be honest: news makes up a small part of our commercial business. Our 2023 and 2024 data points show that fewer than 1% of South African consumers come to Google Search with a news-seeking query. These news queries on Search also don't monetise well. Google Search revenue typically comes from queries with a prominent market intent, like someone searching for the best trail-running shoes.
We're willing to play our part, and since we agree that news holds a societal value, there should be a whole-of-society solution. The onus cannot be on one platform to make an outsized and unwarranted financial contribution. We believe the Competition Commission missed the mark by not requiring publishers to recognise changing consumer behaviour and adapt their business models accordingly.
Industry media fund
Q: The Competition Commission recommended that Google pay R300-million to R500-million annually into an industry media fund for three to five years. What exactly did your written response to the interim report say about this?
A: We're busy finalising our response and will make the non-confidential version available to the media. Again, I want to confirm that we want to continue collaborating with the Competition Commission and South African news publishers towards a balanced and durable outcome based on fact. Their value calculation is rudimentary and not based on accurate figures.
The Competition Commission artificially inflates the percentage of search queries they believe to be news-seeking, and they make a flawed financial calculation based on that. Our data shows that only 1% of search queries are news-seeking, resulting in less than R19-million search ad revenue for Google in 2023. Remember that we don't show ads — or make money — on the vast majority of searches. And we don't run ads on Google News or the news results tab on Google Search.
Considering the economic principles, there's already a robust value exchange. Google makes the search engine available for free. Surfaces like Google News and Discover send referral traffic to a publisher's webpage. Publishers can monetise users on their websites by serving them with display advertising. Using an independent third-party methodology from Deloitte, it is estimated that Google sent R350-million in referral traffic value to publishers in 2023.
Q: So, Google feels targeted?
A: We believe in equal treatment. The onus for the sustainability of public interest news is on all of us — platforms, governments, businesses and publishers. Google was the only platform asked to make a financial contribution. Globally, our learning has been that shared outcomes are far more durable. For example, in California, Google recently co-established a $30-million media fund with contributions from the government and other platforms.
Q: If people are not searching for news, what are they searching for?
A: A whole variety of things! Plumbers near me. How to get a red wine stain out of a carpet. Explain algebraic expressions to a 14-year-old. Interestingly, 15% of Google search queries are new every day.
Q: I was interested in the Competition Commission's finding that search and social media companies had harmed community, vernacular and public broadcasters more than they had the English and Afrikaans mainstream media. What was your response to that?
A: We disagree with the theory of harm. Simplistically, it is also a product of scale. The internet has democratised content discovery, helping people access more types of content than ever — whether a vernacular language news piece or a global news story.
Q: What about the impact on the public broadcaster?
A: The public broadcaster works with the YouTube teams and is part of our YouTube partner programme. They opt to prioritise putting their content on their own app, which will impact their revenue from YouTube.
First gambit
Q: The Competition Commission wants a win-win solution, and this interim report felt like a first gambit to me. Is a win-win solution still possible?
A: Absolutely. Google has clarified that this is the ideal outcome we want to pursue. However, we want to examine more balanced ways to achieve the Competition Commission's goals. Instead of artificially changing our algorithm to favour local news sites, we would instead work with publishers from the ground up to support them with building better websites, increase their understanding of the data analytics available to them, and help them with tech and tools they have access to to support their digital journalism.
This will all lead to more traffic to the local community and vernacular news sites, which, in turn, they can monetise. These publishers also have access to the recently announced R114-million digital news transformation fund, which they can apply to targeted projects to get the basics right. It will be a more resilient solution to address the problem with the technology and training we can make available to publishers for a better long-term outcome instead of a short-term cash injection.
Q: They might say: 'We just want the cash, baby?' And that's not unjustified.
A: A cash-hungry industry is saying, 'Yes, actually, we just want the money', which is the sticking point. Google would be interested in nurturing long-term, durable outcomes, but we would be hesitant to enter into short-term transactional relationships.
Q: Aren't you trying to be too prescriptive?
A: Our intention is certainly not to be prescriptive but to collaborate with the industry to understand their most significant pain points and how we, as a technology provider, can help.
Q: So, Google estimates a R118-billion contribution to the economy in 2023. How? It's not showing up in tax receipts or GDP.
A: That refers to the recently announced economic impact report. This number is the estimated economic activity from the range of Google products, including Search, Play, Android, YouTube, and Cloud, creating value for South African businesses, nonprofits, publishers, creators, and developers.
Q: Google says it has supported news media through R350-million in referral clicks in 2023. In the bigger scheme of things, that's tiny. What's your view?
A: The referral traffic figures reflect user engagement with news content through Google platforms. These figures align with broader trends in reports like the Reuters Institute Digital News Report, which show that news consumption represents a small portion of overall online activity.
Q: I want to get to the Association of Independent Publishers agreement with Google [worth R114-million]. This looks like a workable model. So, how did you and [AIP director] Kate Skinner come up with it, or how did you get to that place? Because it seems like a win-win idea.
A: When I started with Google in 2022, I first brought together all stakeholders, representing the big legacy publishers and the local and community publishers. We devised a set of measures captured in a letter of intent at the time that we collectively believed would make a meaningful contribution to the South African news ecosystem. This relied on components of product support, making available tech, tools, continuous training and a digital news fund. We established that a one-size-fits-all solution won't work, and we wanted to find a way that can support both the big and the small publishers in a manner that fits each purpose. The idea of the fund came out of that initial industry collaboration.
Q: It's been six months. How are things going?
A: The fund is now very much on track. We will soon launch the application phase and hold a series of inspiration sessions where we will showcase projects that publishers are winning with globally. This is only the second such fund that we have established globally. South Africa is the next shining star in terms of how a funding model linked to clear technological or commercial merit-based applications can be a win-win solution.
Q: Google does not make public the revenues earned in a country. Why?
A: We transparently shared the relevant data points with the competition commission. We publicly shared that we made R19-million from search advertising placed next to news queries on Search in 2023.
Q: But you don't declare the entire revenue take?
A: No, it's up to governments to decide the rules here. We are willing to play our part in supporting the South African news ecosystem, but this has to be a shared responsibility. We are looking forward to continuing to collaborate with the Competition Commission and the news industry towards a balanced outcome. DM
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