German media giant Axel Springer admits defeat, allows Google to index its news stories

The latest skirmish in the long-running battle between Google and the German media establishment — over the search giant’s right to display short excerpts from news stories in Google News — appears to have been won by Google. Media giant Axel Springer admitted on Wednesday that removing its news content from the search engine caused traffic to plummet, and so it is allowing Google News to display short excerpts of its news stories again.

As my colleague David Meyer has explained in a number of previous updates, Springer and several other German companies have been fighting with Google for years over what they claim is the company’s theft of their content.

After much lobbying of the government, Germany finally passed a law that requires anyone who publishes more than a short “snippet” of text from a newspaper to pay royalties, a law that was clearly aimed directly at Google News. The definition of a “snippet” hasn’t been determined, however, and Google hasn’t paid any royalties. Instead, it just removed any excerpted content from those German publishers.

Now, the CEO of Axel Springer says his company will allow Google to index its news stories again, because traffic to its news sites has plunged in the two weeks since Google stopped doing so. According to a Reuters report, traffic from Google search fell by 40 percent, and traffic from Google News dropped by 80 percent (the Springer CEO also tried to argue that these figures only reinforced Google’s monopoly power, something it and other publishers have been complaining about the the country’s antitrust authorities).

It’s probably not a coincidence that this decision was announced at the same time that Springer released its quarterly financial results — showing that the media company’s profit growth continues to slow, largely as a result of the decline in print revenue from its newspapers and other publications.

Google has faced similar battles in other European countries over what media companies believe is the theft of their content, and has settled those claims in both France and Belgium by setting up investment funds that are supposed to help publishers get better at taking advantage of the web and digital media in general.

As much as media companies like Axel Springer would like to argue that Google is taking away their business and should be forced to pay, the reality is that they gain arguably as much as — or more than — they lose by having their content indexed by the search giant, and the Springer CEO’s comments reinforce that. Whether any other publishers decide to admit the same remains to be seen.

Post and thumbnail photos courtesy of Thinkstock / Anup Shah