Tech giant Google (GOOGL) is working on a new project that would involve paying news organizations to use their content in artificial intelligence tools, according to a report by Bloomberg. Indeed, the company plans to start with a pilot program that includes about 20 national news outlets. While Google confirmed that it is exploring new types of partnerships and features, it didn’t share details about which companies are involved or exactly how the project would work.
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According to sources familiar with the plan, the licensing project is designed for specific AI-related products, although no one has revealed yet what those products are or what terms the deals might include. Nevertheless, this move comes after earlier attempts by Google to support news outlets, such as its $1 billion “News Showcase” initiative that launched in 2020. That program, which was meant to benefit both publishers and readers, grew to include over 2,300 publications in 22 countries by mid-2023.
Separately, Google signed a deal with The Associated Press earlier this year to provide real-time news updates in order to improve search results in its Gemini app. However, publishers have recently become worried that Google’s AI features, such as AI Overviews and chatbots, are reducing their web traffic. In fact, a June report by The Wall Street Journal said that this change has led some media companies to rethink their business models and lay off employees. As a result, Google’s new licensing move is especially important in order to maintain a good relationship with publishers.
Is Google Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on GOOGL stock based on 30 Buys and nine Holds assigned in the past three months. Furthermore, the average GOOGL price target of $206.51 per share implies 8% upside potential.
