Google hammering out revenue-sharing model with publishers; details unclear

Google, seeking to build bridges with subscription-based news outlets, is planning to share revenues with publishers who take advantage of its new subscription tools.

The search giant's head of news, Richard Gingras, told the Financial Times that the new proposal, similar to its ad system, would use its machine learning know-how and vast collection of user data to find potential new and renewing subscribers, and take a cut from sales when people subscribe or re-subscribe.

Gingras said the revenue split in any such model would be much more rewarding to publishers than the company's advertising model, which gives 70 per cent of revenue to websites.

In an email to Gizmodo, Google spokeswoman Maggie Shiels explained the company hopes to be ''very very generous'' with revenue sharing from subscriptions, but added, ''We haven't worked out these figures. We have to talk to publishers. We have to build everything.''

The exec also rejects arguments that Google is trying to wrest some control from publishers in the vein of Facebook's news subscription service, which uses Instant Articles that run on its own site. "We don't want to own the customer," Gingras said.

''None of this changes the marketplace economics, people will pay for what they value,'' Gingras told FT of Google's plan.

While Google isn't ready to announce final details, according to Endgadget, there is also no guarantee that every major publisher will accept the terms. However, it is evident that Google has come a long way from the days when it was feuding with publishers accusing it of profiting off their work with nothing in return.

It previously downplayed articles locked behind subscription paywalls unless publishers agreed to offer free access to at least three articles per day, making them give up potential revenue just to remain relevant in search results. Now, it's dropping that hard-and-fast rule in favour of profiting when someone decides that a story is worth a subscription.

The situation may not be quite as simple as Google says. Although it's true that Google won't have the same level of control as Facebook, it'll still have considerable sway. After all, Google may be the key to helping publications grow their subscriber ranks. Google may have a lot of sway simply because it has tremendous reach.