Google has entered into a content licensing deal with Australia’s news outlet Seven West Media. Seven West Media said in an earnings call on Feb. 15 that it will provide news content to Google Showcase, which was launched in Australia earlier this month.
Seven West did not disclose the financial details of the deal. The move comes as Australia is pushing for a law that would result in internet giants like Facebook and Google (GOOGL) paying media outlets for content used on their sites.
According to the proposed law, news media outlets can negotiate collectively or individually, over content that drives traffic to Facebook (FB) and Google websites. If these parties fail to reach an agreement, an arbitrator appointed by the Australian Government will set the fees for both parties.
In January, Facebook had said that it will stop news sharing if the Australian government proceeds with the law while Google threatened to withdraw its search engine from the country.
Shares of Google have gone up by about 21% in the past month. (See Google stock analysis on TipRanks)
On Feb. 12, Citigroup analyst Jason Bazinet reiterated a Buy rating and raised the price target from $2,000 to $2,145 on the stock. At the same time, Bazinet removed GOOGL from his top pick list citing the risk of downward estimate revisions.
“While COVID has accelerated the digital ad migration, Street estimates for the next three years seem too high to us. However, even with our more conservative estimates, the valuation seems compelling in both absolute terms and relative to history,” the analyst wrote in a note to investors.
The rest of the Street is bullish about the stock with a Strong Buy consensus rating. That’s based on 29 analysts recommending a Buy and 2 analysts suggesting a Hold. The average analyst price target of $2,317.80 implies about 11% upside potential to current levels.
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