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Google promises to pay news publishers $1bn over the next three years

Google has said it plans to pay news publishers over $1bn in the next three years to create “high-quality content” for its news products.

Writing in a blog post, CEO Sundar Pichai (pictured) said the money will bolster its new Google News Showcase service, an interactive set of story panels that will initially be rolled out to Google News on Android and also planned for iOS.

It will feature the editorial curation of “award-winning newsrooms”, the search giant said, adding that it should give readers more insight on the stories “that matter”, and in the process help publishers develop deeper relationships with their audiences.

The news panels will give participating publishers the ability to package their stories with more context through features like timelines, bullets and related articles, while Google also plans other components to be added like video, audio and daily briefings.

“This approach is distinct from our other news products because it leans on the editorial choices individual publishers make about which stories to show readers and how to present them,” Pichai said.

It will start rolling out today to readers in Brazil and Germany, and will expand to other countries in the coming months.

The publications so far include German titles like Der Spiegel, Stern, Die Zeit, Folha de S.Paulo, Band and Infobae alongside regionally and locally significant publications such as El Litoral, GZH, WAZ and SooToday.

But Pichai said that nearly 200 publications, including those from the UK, Canada, and Australia, have signed up for the service.

“Both News Showcase and our financial investment – which will extend beyond the initial three years – are focused on contributing to the overall sustainability of our news partners around the world,” he added.

“The business model for newspapers – based on ads and subscription revenue – has been evolving for more than a century as audiences have turned to other sources for news, including radio, television and, later, the proliferation of cable television and satellite radio.

“The internet has been the latest shift, and it certainly won’t be the last. Alongside other companies, governments and civic societies, we want to play our part by helping journalism in the 21st century not just survive, but thrive.”

German publisher the Spiegel Group welcomed the project.

“With News Showcase and the new integration of editorial content from Spiegel, Google shows that they are serious about supporting quality journalism in Germany. We are happy to be part of it from the start,” said Stefan Ottlitz, managing director of the Spiegel Group.

News Corp, which has urged EU antitrust regulators to act against Google, was equally enthusiastic.

“We applaud Google’s recognition of a premium for premium journalism and the understanding that the editorial eco-system has been dysfunctional, verging on dystopian. There are complex negotiations ahead but the principle and the precedent are now established,” its CEO Robert Thomson said in a statement.

The European Publishers Council (EPC), whose members include News UK, the Guardian, Pearson, the New York Times and Schibsted, however, was critical.

“By launching a product, they [Google] can dictate terms and conditions, undermine legislation designed to create conditions for a fair negotiation, while claiming they are helping to fund news production,” said EPC executive director Angela Mills Wade.

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