Google’s French Resistance

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Google chairman Eric Schmidt met with France’s president François Hollande Monday to discuss the growing dispute between the search giant and French publishers over Google’s use of snippets of newspaper content in search results without the permission of the publishers. The publishers, like their counterparts in Italy and Germany, want Google to share a portion of the advertising revenue its searches generate with content owners and are pressing the government for legislation imposing revenue-sharing on Google. Hollande issued a statement after the meeting saying, “Dialogue and negotiations between partners appear to be the best option but, if that is necessary a law could be passed on this matter.”

For its part, Google said in a letter to several French ministries earlier this month that such a law would “threaten [Google’s] very existence,” and warned that if forced to pay, the search engine “would be required to no longer reference French sites,” in its results. The German government in August approved draft legislation requiring Google to pay a commission for the use of excerpts but has not yet moved to implementation.

As it happens, I’ll be participating in the GigaOM webinar on Wednesday on Online Publishing: Optimizing and Monetizing Content, where we’ll discuss how publishers can capitalize on viral distribution of their content, via search engines, social media and the like. I’m not sure anyone has a complete or definitive answer to that question, but I’m pretty sure what the Europeans are contemplating is not it.

Forcing aggregators to share advertising revenue will not create new value around publishers’ content. It simply regulates the division of a finite pie. For legacy-print publishers with large investments in original content creation, part of creating new value involves treating their content as a marketable commodity online rather than as simply a lure for eyeballs they can sell to advertisers. Most legacy-print publishers have never really monetized their content directly. But digital publishers presents new opportunities for packaging and selling content to readers in ways that will create new value. The key for publishers is to learn to think more like merchants, rather than simply content creators and advertising platforms.

Tune in Wednesday for what should be a lively discussion. I’ll be joined by GigaOM Pro VP of Research Michael Wolf, GigaOM Pro analyst Lydia Loizides, and Limelight director of product and content marketing Theresa Bui.