Nine signs multi-year deals with Google and Facebook for news content
Nine Entertainment Co (Nine) has become the latest media outlet to sign commercial agreements with Facebook and Google, following the Commonwealth Government’s enacting of the News Media Bargaining Code.
The deal with Facebook is for the supply of news video clips and access to digital news articles on Facebook news products, for a term of up to three years with a minimum amount payable over the term.
The five-year agreement with Google includes the supply of news content (excluding video) for Google’s News Showcase and other news products. Google will also expand its marketing initiatives across Nine’s platforms such as The Sydney Morning Herald, The Australian Financial Review and The Age. The amount payable is a fixed annual fee with “modest growth” in the early years, according to an announcement on the ASX.
As a result of the deals, Nine expects to grow its publishing division’s earning in FY22 by $30 million to $40 million. No exact value of the deals has been disclosed.
CEO Mike Sneesby said in an internal note to staff that the deals will play a role in leading the company to a situation where the majority of revenue is digitally led. “These deals will contribute to supporting the world-class journalism on which our business thrives and to give us the opportunity to pursue growth that will continue to underpin the long-term strength of our business,” he wrote.
“These deals consolidate our position in an increasingly competitive market, but we will need to remain creative and open to opportunities to improve what we do and how we do it.”
The announcement also cited the the termination of Google’s previous sales agreement on programmatic advertising sales revenue from 1 March 2021.
Nine had been vocal in its criticism of the two platforms throughout the News Media and Digital Platforms Mandatory Bargaining Code senate committee hearings.
Nine had previously refused to participate in Google News Showcase, denouncing its launch as another sign the tech giant will not negotiate reasonably with media companies.
“This is what monopolies do, they put an offer, in the form of Google Showcase, but not offer to negotiate,” a Nine spokesperson said at the time.
Chris Janz
Chris Janz, chief digital and publishing officer at Nine Entertainment Co, said at the senate hearings that Nine would not commit to the use of the monetary value from deals with Google and Facebook, but that it hoped they would “be able to invest further in journalism, and that would mean hiring journalists, but there is uncertainty as to how many”.
He further stated: “If you rewind from 2013 to today, the digital advertising revenue of The Sydney Morning Herald, The Age and The [Australian] Financial Review has halved, and its halved because we’re competing against monopolies that control access to the internet and the advertising ecosystem around the internet and the data that exists around the internet…. and if we accept for one minute that Google and Facebook can be unregulated monopolies that don’t contribute to the cost of the content they’ve used to build their businesses, I think it leads to a terrible outcome for Australia.”
To date, none of the media companies to sign deals with Google and Facebook have slated what investments in journalism the funds will be used for.
In FY2021, the digital and publishing division of Nine reported net income of $92 million. This represented at the rime the company’s Metro Media and Nine’s other Digital Publishing titles including Pedestrian Group, CarAdvice and nine.com.au.
Fellow media outlets, News Corp, Seven West Media, Australian Community Media (ACM) and The Guardian have already signed commercial deals with Google and Facebook. ABC announced last week it had signed a letter of intent with the two platforms.
Mumbrella’s editor-at-large Tim Burrowes has initiated discussions with Facebook and Google on behalf of Mumbrella, he is still waiting for responses from the two organisations.
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Olivia Kruimel is the managing editor at Mumbrella. She has more than 15 years of experience in journalism, communications and marketing. Her journalism career began at Fairfax Media (now part of Nine) and includes various B2B publications such as B&T, Travel Today and ALB. As a marketer Olivia has worked for Standard Chartered and various global law firms.
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