Post-Perugia thoughts: what went wrong between big tech and the news?

This article first appeared on Madhav Chinnappa's LinkedIn and has been republished with permission

Madhav Chinnappa is the former director of news ecosystem development at Google

It has been just over two weeks since my lovely trip to the exhaustingly thought-provoking International Festival of Journalism. The organisers Christopher Potter, Arianna Ciccone and Francesca Cimmino have created something beautiful and quite a bit magical.

I have been reflecting on my session with Jesper Doub in Perugia: What went wrong between big tech and the news? And did anything go right?

While I enjoyed it in the main, I came away with a nagging sense of missed opportunity as due to a misunderstanding about logistics, I never got to the last half of the pre-submitted questions which was the forward-looking part.  

I also wanted to acknowledge some of the sentiment in the Q&A around the damage tech companies have been part of: I truly believe most of this has been negligence rather than intentional vandalism. I hope that I have personally played a part on the positive side of the ledger but that's for others to judge, not me.

Back to the session: below is what we did not get to - mainly about the future. Probably best read after you have seen the session. And please do read all the way to the bottom if you can as I have some ideas.

What have news organisations learned from partnerships with tech companies like Google and Meta? Should or should they not forge partnership deals with OpenAI and other AI companies? 

• I posted on LinkedIn my friend and ex-colleague Jim Albrecht's Washington Post OpEd about GenAI, Publishers and licensing and I agree with Jim that publishers should focus on licensing grounding data, not training data for many reasons including that any one publisher is an infinitesimally small part of the vast data set of Training Data plus LLMs are incentivised to have the best grounding data.  

• But what troubles me is how to make this "open" - ie the current model may get the big publishers paid but what about the local/small ones? How do we create a model that would allow for everyone in the ecosystem - including independent AI companies and not just the ones with enormous valuations to participate and benefit? The best I have come up with is that it will need to be a bit like music rights but if someone wants to sponsor me to do a fellowship to study and propose a model, please contact me.

Despite the things that went wrong between big tech and the news ecosystem, what is one thing you still believe should be pursued?

• I believe in pragmatic collaboration.  

• I think the issues that the news ecosystem faces are too big for any one company to solve and that we are all better off if we face these issues together.

• Thus, I am proud of the product launches that came from DNI like AMP, YouTube Player for Publishers, Subscribe with Google etc.

• I wish there was an environment to focus on durable product solutions like those, rather than a regulatory arm-wrestling contest.

• I also strongly believe that there are many intangibles from some of the ecosystem facing initiatives like support for things like the International Festival of Journalism in Perugia, the Reuters Institute for the Study of Journalism and its Digital News Report - and we all need to find the money to keep these going, especially when tech companies sadly retreat from the space.

• Please see at the end a few ideas I suggest to move us forward into positive action.

And did anything go right?

• While I am proud of what we achieved and our aspirations, I do not think it is for me to judge what went right.

• I would love to hear other people's answers to this question.

What advice do you have for new publishers about the withdrawal of the relationship with big tech? How do they uncouple and reduce their overall dependency?

• From my perspective, publishers should always ask themselves what are they trying to achieve. I hope the answer is to serve audiences, build loyalty and play a positive role in society. The tech platforms therefore are a means to an end.  

• And you should be thinking about this from both sides: what is in it for each tech company and how could that change and how do you as a publisher leverage that?

• One example I give is Village Media in Canada - the CEO Jeff Elgie who is one of the smartest news CEOs out there, is on the record saying that he does not want tech platform money, he wants their traffic as a marketing funnel to build a loyal user base. That is how you build a durable business.

How do you respond to the criticism that Google’s support of media literacy and news innovation lacked providing guidance to its grantees in how to keep an initiative going after Google funding was gone?

• A brilliant question and totally fair criticism. This is one I truly regret though I know the decisions I made were done in the context of the time.

• To explain: with the original DNI Fund we ended up funding 662 projects over almost 5 years but I can’t tell you how all those projects fared after the funding ended - which in essence is one of the most important metrics. I can tell you about some but we never did a comprehensive review.

• Why, I hear you ask? Well, it starts with the context in 2015 when we launched the DNI Fund. We were under attack from many sides who saw it as something that was trying to "buy off" the news industry and/or trying to steal innovative IP.  

• Because people assumed the worst, I made the decision that each project would default to being private - publishers did not have to talk about it nor did they have to share any info with us (beyond the project KPIs).  

• This was done so that when people said you are buying people off or harvesting IP, I could say absolutely not and we default to private to safeguard against even the perception of this.

• I wish we had partnered with an academic institution to do a longitudinal study about the impact of the Innovation Fund. My personal observation is that the biggest impact was on culture rather than silver bullet product solutions - as those do not exist.

And I think it is worth reprising the question about advice to platforms, regulators, publishers - as I think it might be the most salient of them all:

What is each of your top advice to (a) platforms, (b) news publishers, and (c) regulators? 

To platforms:

1. Realise that news is more important to society than it is to you so if you want to play a part in society please stay committed to news (or come back)
2. Realise the regulation fight is about power first and then money second so do not think that buying off the big publishers will solve the regulation fight and please, please, please do not view news as a "problem"
3. That regulation fight is there due to the underlying structural disruption that the internet caused to the news industry so work on a product level with the industry - I do believe we work better together

To regulators:

1. Do not kowtow to News Corp and Axel Springer
2. Enunciate the problem that you are trying to solve
3. Focus on the entirety of the news ecosystem from the bottom up

To publishers:

1. Do not kowtow to News Corp and Axel Springer - or more specifically, do not try to grab onto their coattails and hope you benefit when they take all the money
2. Work together both as a collective and also with tech companies where appropriate - not everything is a zero sum fight
3. Focus on more than just the short term - sustainability is a long-term issue and working on that benefits everyone, society and other news publishers so don’t just focus on the short term

And if you made it all the way down to this, here are my top three ideas that are better than any News Bargaining Code/Link Tax that gets money into the news ecosystem:

1. A hypothecated tax: if you are trying to move money from one industry into another then be clear about it and create a tax that does exactly that! (And thanks to Rasmus Kleis Nielsen for teaching me the word "hypothecated")
2. A country fund: take the news-derived Search advertising revenue in any country and add a multiplier (for the public service importance of news and the fact that this is generally a relatively small amount), say 10x and put this into a Fund to fund what the news ecosystem needs in any given country. You could even get an organisation like IFPIM to manage that fund in the right way. 
3. A digital advertising tax: props to Styli Charalambous as this is his idea - put a small tax on digital advertising - and put that into a country fund (see #2 above)

Happy to discuss any of the above, plus the actual session, including the spicy Q&A while respectfully preferring to discuss the substance of what I know more about. Thoughts?

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