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March 28, 2024

Broadcasters Test The Rev Share Economy in Open-Web Agreements

Important Details: The licensing of local broadcast news by Hearst Argyle – from five TV stations – to YouTube is a first-of-its-kind deal. In licensing local broadcast news for the free web, Hearst Argyle is agreeing to take related ad revenue shares, and YouTube is for the first time agreeing to share revenue with local broadcasters.

The Hearst Argyle deal followed a recent announcement of a CBS/Voxant agreement. CBS is making its national and its owned-and-operated news/weather/sports video available through the Voxant syndication service. Here, too, an advertising revenue split is involved, with CBS, Voxant and the website distributor of the video each getting a share.

Implications:  We can see from both these announcements that local news is hot, and deserves a share of the online ad pie – if video is involved. Broadcasters have been slower to monetize their legacy assets than print publishers, but they are now moving forward quickly to make money from re-use. With video advertising one of the fastest-growing segments and with rates ranging from $20-$65 effective CPMs, the new revenue line here may grow quickly to be a significant one for broadcasters.The willingness of YouTube, a Google property, to offer a revenue share to broadcasters raises a timely question for print publishers.

There’s precedent for text producers to get “licensing fees” from Google. Within the last year, the Associated Press, Agence France Presse and Belgium-based Copiepresse have all done so. Yet we see no agreements between the big newspaper companies and Google.

Outsell believes that print publishers should connect the dots, moving on the AP/AFP/CopiePresse and Hearst Argyle/YouTube precedents and pressing Google for a piece of the pie for text as well as video. Sure, the same questions apply to #1 news site Yahoo! and other aggregators. But many publishers have already put together a comprehensive deal with Yahoo!, in part re-capturing value in its intention.

It’s Google that is the behemoth. While it ranks only about 10th top-ranked news site in recent U.S. rankings, it is becoming the gateway to web, with its #1 search and online advertising ranking. In addition, persistent talk of the next stage of Google News, incorporating Digg-like functionality, may further rocket it up in the standings.

Why do publishers deserve a piece of the ad pie? There’s no doubt that the headlines and briefs appropriated by Google and other news aggregators have value, even if they may be covered by “fair use.” Those news bits are the bait that pull millions of customers onto aggregator sites. Sometimes those eyeballs are monetized directly on news pages; sometimes they move on to other aggregator pages where ads are then served.

Either way, all those news bits have lots of value, and little of it is being recouped by publishers today. Outsell has heard that only about 5% of the views of news aggregator pages like Google News and Yahoo! News lead to click-throughs back to a publishers’ sites. If that number is correct, then 19 of 20 of those views lead elsewhere to pages offering all kinds of social networking, local and entertainment products and services. If that 5% number is wrong (too low? too high?) it would be great to have the aggregators show publishers what it really is.

Re-capturing value in the digital age takes many forms, and publishers getting their just desserts from major aggregators should be one of them.