The Alliance report, however, explicitly excluded any analysis of programmatic display and the amount of working media dollars that might be skimmed off in programmatic fees collected by Google, Facebook or a host of other programmatic players. It focused instead on the amount of news content delivered in Google search results, which highlights the important role news content plays in the user experience of Google.
It’s undeniable that the presence of news content in Google search results makes Google’s search engine more valuable to consumers; the more content indexed by any general search engine, the more useful it is to those querying it.
But the connection to revenue is more second-order than first: The Alliance report looked at the overall volume of news results returned for a set of trending queries, but did not include information about how many ads were present on those same results pages, let alone clicked on. Search results pages that are returned for queries involving news-related topics are often ad-free; for example, a search for “Syria” does not return any sponsored results.
At the time of this writing, even a results page for the query “Hong Kong”—which might at a less-newsworthy time include travel-related ads when accessed from the US—has no ads. A check of the top 10 Google Trends searches for today (the starting point of the News Media Alliance methodology) returned 10 results pages with no ads.
Google (and Facebook, as well as a host of other ad tech providers) does have a more direct connection to media business ad revenues in the form of its programmatic display business. Google’s display ad stack is massive and complex, and there’s been a lack of adequate research into how much of the value created by the behavioral targeting facilitated by programmatic display makes its way to publishers, as opposed to being captured by ad tech providers instead. (In May, the Wall Street Journal covered an academic study that claimed behavioral targeting earned publishers just a 4% premium on impressions despite a much larger increase in ad prices, but the research had significant methodological limitations.)
So while the Facebook-Google duopoly and impact on the news industry is undeniable, it’s not exactly fair to say that Google is siphoning $4.7 billion off the news industry based on a decade-old estimated figure.
We are in the process of conducting research that we hope will allow us to estimate the amount advertisers are spending on programmatic fees, also known as the ad tech tax. We expect to publish this research later this summer. In the meantime, read our latest report on US programmatic ad spending for 2019.