Google-AP Beef Escalates Print Media War With Internet

Print media is screwed – we all know that. But now Google CEO Eric Schmidt is telling newspapers to innovate, and the Associated Press is screaming at him to shut the hell up and give them some freakin’ cash. Behind all this hoo-ha though, there remains the fact that newspapers are too reluctant to look beyond the advertising revenue model.

The Google/AP hoo-ha is over whether Google effectively steal from newspapers in using their content for free – Robert Thomson, the editor of the Wall Street Journal, stated colourfully that Google were “tapeworms in the intestines of the internet”. The row started earlier this month, at the Newspaper Association of America, where Eric Schmidt told newspapers they had dropped the ball in letting Google distribute content. Schmidt opened his NAA keynote address with the words: “Try to figure out what your consumer wants. If you piss off enough of them, you will not have any of them.” The AP responded with upturned noses and an “industry initiative to protect news content from misappropriation online”. By which they mean a demand for a share of the revenue Google picks up from their content.

AP president Dean Singleton bawled, a la Network’s Howard Beale: “We’re as mad as hell and we’re not going to take it anymore!”, as the AP threatened Google (plus other search engines and aggregators) with legal action for using the work of news organisations without any “fair” revenue share. The claim is that Google are making money from news organisations: they summarise the content, index it, then use it to attract people to their site and therefore sell ads. The news organisations however, commission the work, pay for it, then get no return.

Earlier this week, Eric Scmidt was quoted as calmly advising the shrieking industry: “The best way to get out of this is to invent a new product. That’s the way Google thinks. Incumbents very seldom invent the future….The whole secret here is the ads are worth more if they’re more targeted, more personal, more precise.” As much as innovation is key, the ad model is proving to be a problem. Jeff Jarvis pointed out that newspapers have had 10 years to adjust; to think and develop accordingly, and they haven’t been radical enough. “When papers die,” he says, “there will be silence, confusion and chaos and a few bad guys will escape the watchful eye of journalism. The good news is this: into this crying need, this vacuum, entrepreneurs will rush.” It’s a bleak prospect this journo-pocalypse, but as another newspaper falters almost every week, it seems the reality is rushing ever forward.

What the AP resistance serves to highlight is Google’s unquestioned lordship over the internet - email, RSS feeds, maps, images, news. And Google is the best at these things; challenging Google is a bit like David and Goliath, only David hasn’t got any little rocks to chuck in Goliath’s eyes this time. The underlying question is whether Google can do without news organisations, or visa versa. In the unlikely event, Google could probably take a hit that big and survive, but I think it’s fair to say that in this climate, news organisations cannot do without Google, as Google brings hits, and hits brings ads, and ads are one of two largely unsuccessful revenue models currently clutched at by the industry, the second being charging for content.

Advertising is now bringing insufficient revenue for newspapers. It’s also harder to target and specialise ads with news content, and a report out this week shows that even MySpace and Facebook users are hacked off with endless adverts and app requests asking if they’d like to receive another tastefully designed ‘council estate gift’ or BFF digital charm necklace. And as we saw recently, the maths of charging for content, unless you’re the WSJ or FT and have unique content that you’ve been charging for since day one, simply doesn’t add up.

The Guardian appears to be the only UK newspaper innovating effectively with the development of its Open Platform API service, which Bad Idea reported on back in March, and Arianna Huffington at the Huffington Post, talks of seizing the oppurtunities that “disruptive innovation” provides, pointing to their traineeships for investigative journalists, among other things.

Apart from this there’s not much innovating going on in the industry, just a lot of griping about the state of things and fiddling about within the framework of two existing models. As for Google’s position in all this, Tim Luckhurst on the Guardian’s Comment is Free, says that “Google doesn’t understand journalism”. Of course they don’t, they understand the internet and making money from it, and equally, journalism doesn’t understand the internet and making money from it. The industry is being stubborn, and Google are being ruthless.

Posted by Jennifer Allan in Creative Economy | April 24, 2009 12:56PM |