Google will pay SA media houses R688m over the next five years after the tech company struck an agreement with the Competition Commission as the authority finalised its Media and Digital Platforms Market Inquiry (MDPMI).

News24 reports that the commission found Google was dominant in search and had not been distributing the money it makes from news with the creators of the content.

The commission yesterday published its final report on the MDPMI, bringing to an end a more than two-year investigation to determine whether there are features of digital platforms that distribute news content that may impede, distort, or prevent competition.

Google had argued that displaying news is not particularly lucrative for the company because news results are not very attractive to advertisers.

Google estimated that news content generated less than R35m in revenue in 2022.

In its final report, the commission viewed the matter differently and said news is an important part of the content offering, which meant that its value to Google should be viewed in terms of how frequently Google serves up news content.

‘In search, Google maintains a dominant position, where news represents 5-10% of queries and drives user engagement that is monetised through commercial advertising. Google does not, however, compensate SA media for the news content it displays or summarises,’ the report said.

The commission estimated that the value imbalance was between R200m and R300m annually in favour of Google.

For national publishers and broadcasters, Google’s newly struck deal will pay R71m per annum for five years for content on Google News Showcase and will pay R45m a year for an AI innovation fund for three years.

For small, independent, and community media, Google will pay R38m each year for three years to the digital news transformation fund and R19m per annum in ‘matching funding’ for an additional two years, while also providing R11.6m in training materials in vernacular languages.

News24 notes that Google has also agreed to launch a variety of training initiatives, a data transparency initiative, and will offer a toolkit that provides support for micropayments for news stories.

Full News24 report