Ailing news industry blames Google, but misses the point
If it is true that Google “is profiting from online news pages” as this BBC article claims, then if Google limits access to free news, the newspaper industry will see a correlating increase in online revenue, right?
Not necessarily. I ran across this article by the Google CEO Eric Schmidt, dated one day before that misinformed BBC article was published. Schmidt argues that it is not the fault of the popular search engine that the newspaper industry is struggling against a thinning revenue stream, especially in the online market. They are struggling because the newspaper industry has failed to adapt their methods as technology evolves.
People that read news online today don’t buy a whole paper– or two or three. They skim the headlines on news aggregates (Google News, Newser), and pick and choose which articles they wish to read. Personally, I visit a dozen different websites daily for my news fix. Schmidt calls this the “atomic unit of consumption.”
Think about it. Newspapers have used the same presentation methods for decades with little adjustment. It worked for a long time. Then TV News came along and newspapers started to struggle. Since the rise of the Internet, they have been fighting not to drown.
The technology has changed, the methods of consumption have changed, but the news industry has not. So who is really to blame?
Curiously enough, the BBC article and Schmidt’s article both cite Murdoch–in defense of opposing sides. It is not even necessary to quote BBC. Schmidt’s case trumps the BBC article in evidence and logic:
“It’s understandable to look to find someone else to blame. But as Rupert Murdoch has said, it is complacency caused by past monopolies, not technology, that has been the real threat to the news industry.”
One more thing: Schmidt mentioned a new project called Google Fast Flip:
“The theory—which seems to work in practice—is that if we make it easier to read articles, people will read more of them. Our news partners will receive the majority of the revenue generated by the display ads shown beside stories.”
This might be a win for both sides. News companies better hop on that bandwagon or start to write their own obituaries.
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