Google, AP strike new deal on licensing rights for news reports

AP executives have publicly complained that the news cooperative wasn't being adequately compensated for its material, partly because Google's search engine pointed to websites that the AP said had pirated its content.

Google, in turn, insisted that it was adhering to all international copyright laws as it tried to help Web surfers find pertinent information.

Besides the AP, Google also licenses news content from Agence France-Presse, UK Press Association, Canadian Press and seven members of the European Pressphoto Agencies.

Under these licensing agreements, Google publishes entire stories from the AP and other outlets in the news section of its website.

That's a departure from Google's usual practice of just showing snippets from stories posted on thousands of other websites. Google maintains those excerpts qualify as “fair use” under copyright laws, exempting the company from having to pay any licensing fees to most Web publishers.

Some media executives, such as News Corp. CEO Rupert Murdoch, have blasted Google for the practice, arguing that Google is profiting from the work of others. Google contends it is helping newspapers by driving more traffic to their websites.

Unlike newspapers and broadcasters, the AP doesn't try to draw traffic to stories on its own website. Rather, the AP licenses its content to other media, which sell their own advertising in print, on the airwaves and on the Internet.

But advertising in other media, especially print, has been crumbling in recent years, prompting the AP to reduce the fees it charges U.S. newspapers and broadcasters.

Squeezed by those concessions, the AP's revenue fell nearly 10 percent to US$676 million last year and management anticipates another drop this year. The slump prompted the AP to lay off about 90 employees from its news staff late last year, the biggest cutback at the cooperative in decades. The AP also eliminated other jobs through buyouts and a hiring freeze.

Google, meanwhile, has been thriving, even during the worst U.S. recession since World War II. The company earned US$6.5 billion on revenue of nearly US$24 billion last year. Its net income is on pace to surpass US$8 billion this year.

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