Seven West Media inks news deal with Google

The network has signed an agreement with the search giant and also announced positive half-year results

Seven West Media (SWM) has entered into a long-term partnership with Google to provide news content for the Google News Showcase product. The news comes as the network announces strong results for the half-year to December 2020.

The freshly struck agreement with Google will see SWM’s 21 titles available via Google’s Showcase offering, the search giant’s solution to licensing and paying news media organisations for their content. It’s subject to executing a long form agreement within the next 30 days. The platform launched in Australia last week and will appear across Google News on Android, iOS and the mobile web, and in Discover on iOS, and will come to Google Search.  

The agreement comes just days after the Australian Senate endorsed the ACCC’s News Media Bargaining Code requiring digital giants, Google and Facebook, to pay news media organisations for showing organic search links and excerpts of content from their websites and be subject to mandatory arbitration if commercial deals cannot be reached.  

In a statement, Seven West Media chairman, Kerry Stokes, welcomed the deal with Google and thanked the Prime Minister, Scott Morrison, Treasurer, Josh Frydenberg, and ACCC chair, Rod Sims, for their “instrumental efforts” reaching the “ground-breaking agreement”.  

“Their outstanding leadership on the implementation of the proposed News Media Bargaining Code has resulted in us being able to conclude negotiations that result in fair payment and ensure our digital future,” Stokes said. “The negotiations with Google recognise the value of quality and original journalism throughout the country and, in particular, in regional areas.  

“Google is to be congratulated for taking a leadership position in Australia and we believe their team is committed to the spirit of the proposed code," he added.

Google Showcase was launched in Australia last week in the thick of debate around the News Media Bargaining Code. The offering has been positioned by Google as an alternate to the Bill's news media payment scheme, which focuses on payment via organic search. The curated news offering sees participating publishers paid a monthly fee for content published via the Showcase vehicle and featured with clickthroughs to the publishers' site.

Google said 450 publishers are participating so far across 12 countries including local players Crikey, The New Daily, The Canberra Times and The Conversation.

“This is another significant step in Seven West Media’s transformation journey," SWM managing director and CEO, James Warburton, said of today’s announcement. “Google recognises the strength of our audiences through our engaging content and leading platforms. We are excited to be partnering with them as we pursue the next stage of our strategy.”  

SWM results

The Google News Showcase announcement came as the ASX-listed media giant released its half-yearly results to December 2020, noting prime time audience gains with a content-led strategy that has given the network the top spot in both broadcast and BVOD audience share.

The 7plus platform was the top commercial free-to-air BVOD platform in 2020 and added a mandatory sign-in across devices combined with an enhanced data strategy that has reduced the revenue to viewing share gap and seen registered users grow 84 per cent.

On the financials, EBITDA, or net income, was $166 million, up 24 per cent, with gross revenue down by 10 per cent to $644m and expenses also down 18 per cent to $48m.

Warburton noted the network had significantly improved ratings share and gained a more attractive demographic profile. “We secured the leading share of audiences in broadcast and BVOD in the half,” he said.

The network’s new ‘tent pole’ strategy of existing popular shows with new ones is delivering, on average, 75 per cent more audience than the old content strategy. “This will translate to higher revenue share in the coming 12 months,” Warburton predicted.

Alongside the content play, the network is undertaking a digital transformation and working to lift its data-driven audience capabilities. Over the last year, this has seen it launch 7REDiQ, its audience insights, activation and measurement platform supported by data partnerships with the likes of TEG, flybuys, LiveRamp and Adobe among others. In its financial report, the network said the majority of digital advertiser briefs now require a data and insights overlay.

The network expects consumer first-party data to double and is looking to the Olympics to grow its registered audience.

“Our digital transformation can be seen in the success of 7plus, which has revenue was up 79 per cent in the period versus market growth of 44 per cent,” said Warburton.

Looking at the ad market recovery, Warburton said SWM wants to capture more audience share as things improve. “We are determined to monetise those results in 2021 and are targeting a material increase in revenue share,” he said.

“7plus was the number one commercial free-to-air TV platform in 2020 and we’re targeting the number one revenue share spot as well.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, or follow our regular updates via CMO Australia's Linkedin company page.

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